Mumbai, October 12, 2026: PL Capital’s sector-wise earnings previews for the July-September 2026 quarter (Q2FY27) indicate divergent performance across Indian industries, with demand momentum, order execution and sector-specific growth drivers supporting activity in several segments, while elevated input costs, margin pressures and external uncertainties are expected to weigh on earnings.
The outlook for financial services is mixed, according to PL Capital. Asset management companies are projected to benefit from growth in equity quarterly average assets under management (QAAuM), with core income for the coverage universe estimated to rise 3.6% quarter-on-quarter and 11.8% year-on-year, though revenue yields may soften. Banks are expected to see continued loan growth, but net interest margins remain a key monitorable. Auto financiers and housing finance companies are projected to maintain steady disbursement momentum, while hardening bond yields could pressure margins. Insurance is expected to post healthy business growth, with profitability and margins under scrutiny.
Automobile and building materials outlook
Automobile sector dispatches have been supported by retail demand and festive stocking, but profitability is likely to be constrained by elevated raw material costs, supply-chain disruptions and delayed pass-through of input-cost increases. Operating leverage and price hikes may provide some relief. In building materials, pipes are expected to perform better than wood panels, which face export headwinds. Cement volumes are projected to grow about 10% year-on-year, but higher fuel and operating costs could impact profitability, making pricing actions important.
Consumer, industrials and chemicals trends
Consumer staples are expected to see double-digit growth, though the outlook for the second half of FY27 depends on inflation and rainfall. Consumer durables should benefit from growth in wires and cables and continued demand for room air conditioners. The education sector’s stationery coverage universe is projected to see EBITDA decline 17.7% year-on-year due to raw material inflation.
In industrials, capital goods companies focused on transmission and distribution are expected to perform relatively better, while execution challenges may affect engineering, procurement and construction activity. Infrastructure execution is expected to remain steady, but order inflows have moderated. Electronic manufacturing services (EMS) companies are projected to post 26.0% year-on-year revenue growth in Q2FY27, with margins expanding by 30 basis points to 9.9% and profit up 8.6% year-on-year. Renewable equipment is expected to see moderate growth with gradual margin recovery.
Specialty chemical companies are expected to report steady year-on-year revenue growth, though sequential moderation is anticipated. Domestic agrochemical demand remains under pressure, while strong refrigerant gas prices are expected to support fluorochemical earnings. Metals and mining companies are expected to maintain volumes, with cost pressures persisting. Oil and gas earnings recovery is expected to be led by oil marketing companies, with upstream producers benefiting from crude realisations, while city gas distribution faces challenges. Power companies are expected to benefit from improved demand.
Pharma, IT and services sector performance
Pharmaceuticals are expected to see support from domestic growth and currency tailwinds, while healthcare is projected to report a healthy quarter, aided by new bed additions and seasonal demand. Information technology is expected to see selective growth amid broader sector challenges. Telecom performance is likely to remain supported by average revenue per user and subscriber growth.
In services and consumer-facing segments, logistics companies are expected to deliver a steady quarter despite wage and fuel inflation. Ports are projected to report healthy growth despite operational disruptions. Media is likely to see contrasting trends, with cinema exhibition benefiting from strong occupancy and broadcasters facing challenges. Real estate is expected to remain supported by healthy new launches. Textiles are expected to show resilience despite renewed US tariff concerns, while travel and tourism is projected to see steady hospitality performance but continued turbulence in aviation.
Key factors for Q2FY27 earnings
PL Capital’s previews highlight a differentiated earnings environment for Q2FY27, with demand trends, execution strength and sector-specific drivers supporting selected industries, while input-cost inflation, margin pressures and uneven demand remain important monitorables. The company said commentary from corporates and quarterly results will be crucial in assessing the sustainability of growth and profitability across sectors.
Disclaimer: This article is based on a press release provided by the concerned organisation and has been edited for style and clarity with the assistance of AI tools. BusinessFortnight does not verify, endorse, or take responsibility for the claims, figures, or statements made in the original release.
