India Equity Strategy: Earnings Trend Reasonable; Sustenance Key - Risk Reward Favorable

Research evidence excerpt

India Equity Strategy: Earnings Trend Reasonable; Sustenance Key - Risk Reward Favorable

India Equity Strategy

09 July 2026 Citi Research

– Non-Lending Financials: Insurers: expect APE growth to remain modest for

life insurers. For Capital Markets, we expect a soft print for annuity capital

market plays, and moderation in order growth for transaction-based players.

– Energy: RIL: O2C to improve QoQ on higher GRMs and strong petchem

spreads. Retail EBITDA growth is likely to remain soft owing to QC

investments. OMC: likely to witness material losses on sharply negative retail

fuel margins and higher LPG under-recoveries, partly offset by strong GRMs,

inventory gains etc. Gas: Margins for CGDs to be flattish to down QoQ due to

higher gas costs. Upstream: ONGC’s standalone EBITDA is likely to improve

QoQ on higher oil and gas realisations.

– Metals: Expect QoQ EBITDA/t expansion in steel, driven by realization

improvement partly offset by higher coking coal costs. Non-ferrous: Higher

aluminium and weaker rupee should help QoQ EBITDA improvement; expect

Novelis EBITDA/t to fall QoQ.

– Industrials: Expect continued short-cycle strength for the electrification/DC-

exposed names, with YoY order inflow comps augmented by price hikes. ON

margins, expect a mixed print although key input costs have started to ease

and price hikes are offsetting. Margins should be resilient for defence

companies on account of inventories being carried.

– Internet: Expect strong growth in online food delivery, and both horizontal

and vertical e-commerce plays. Quick Commerce: competition remained

intense in the sector, but we expect Eternal to post a strong mid-teens QoQ

NOV growth while Swiggy likely prioritized contribution b/e above growth in

1Q. Watch Swiggy’s commentary on the path ahead.