India Equity Strategy: Highest earnings growth since Jun-2024; reiterate Nifty-50 target 27K

Research evidence excerpt

J P M O R G A N

Global Markets Strategy

16 August 2026

India Equity Strategy

Highest earnings growth since Jun-2024; reiterate Nifty50 target 27K

The FY27 earnings season started on a stronger-than-expected note, with

MSCI India companies’ revenue and PAT growing 19% and 16% YoY in 1Q.

For the Nifty Midcap 100 (ex-Energy) and Smallcap 100 companies, PAT came in

at a strong +42%/+39% YoY, respectively (see Figure 10 and Figure 11). The key

highlights of the quarter were that for MSCI India, beats/misses came in at

58%/24% and there was better sectoral breadth of earnings growth. The dominant

theme across 1QFY27 management commentary was that resilient domestic

demand continued to offset an unusually noisy external environment. Within

MSCI India, Materials, Utilities, Industrials and Discretionary reported high

earnings growth (%YoY). Beneath a healthy topline, aggregate profitability was

dragged down by a handful of heavyweights (ITC in staples, Dr Reddy's and Cipla

in healthcare, IndiGo in industrials/transport, and OMC marketing losses in

energy), masking genuinely strong underlying trends elsewhere. The clearest

structural bright spots were power demand (record ~271GW peak), the capex/grid/

defence cycle, autos (volume-led, exports scaling) and a volume-led recovery in

consumer staples. The overall tone was broadly constructive but prudent, with

companies emphasizing profitable expansion over volume-at-all-costs strategies,

calibrated pricing, and margin discipline, and largely maintaining (rather than

raising) full-year guidance after a strong Q1 amid geopolitical and monsoonrelated uncertainty. We estimate MSCI earnings to grow by 11%/13% for

CY26/27 respectively. Our preferred positioning leans heavily towards highgrowth domestic cyclicals. Our base/bull/bear case Nifty-50 targets remains

27,000/30,000/20,500 respectively.

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MSCI India companies’ revenue/PAT grew by +19%/+16% YoY with

EBITDA margins expansion of 10bps (ex OMCs). This is sharply higher

than the +10% YoY growth reported in 4QFY26. MSCI India’s beats/misses

came in at 58%/24%.…