The corporate earnings for the first quarter of FY25 largely aligned with expectations, driven predominantly by domestic cyclicals, according to a recent review by Motilal Oswal Securities Limited (MOSL). Significant contributions to the overall growth came from sectors like Healthcare, Real Estate, Capital Goods, and Metals, while earnings were weighed down by Oil Marketing Companies (OMCs).
Earnings for the Nifty-50 rose by 4 percent year-on-year, slightly exceeding MOSL's estimate of a 3 percent growth. However, the overall performance was dampened by the drag from OMCs. When excluding OMCs, the Nifty posted a 9 percent earnings growth, just shy of the brokerage's expectations of 10 percent growth, indicating that other sectors performed relatively well despite the challenges in the oil sector.
Looking ahead, MOSL expects the earnings momentum to continue but at a moderated pace, projecting growth to taper to around 15 percent over FY24-26. The corporate earnings scorecard for Q1FY25 met expectations, with heavyweights like HDFC Bank, Tata Motors, ICICI Bank, Maruti Suzuki, and TCS driving the aggregate earnings. Industrials and Capex, Consumer Discretionary, Real Estate, and PSU Banks are its key preferred investment themes.
Here are five standout stocks that delivered over a 45 percent jump in Profit After Tax (PAT) during the June quarter, reflecting their strong operational performance and positioning within their respective sectors:
Adani Enterprises: Adani Enterprises, the flagship entity of the Adani Group, reported a substantial 116 percent year-on-year (YoY) increase in consolidated net profit, reaching ₹1,454 crore for the first quarter ended June 2024. This marks a significant rise from ₹674 crore in the same quarter of the previous year. Additionally, the company saw a 12 percent YoY growth in revenue from operations, which climbed to ₹25,472 crore compared to ₹22,644 crore in the corresponding period last year. The stock gained over 24 percent in the last 1 year and around 9 percent in 2024 YTD.
Apollo Hospitals Enterprise: Apollo Hospitals, a leading player in healthcare services, reported an impressive 83 percent rise in consolidated net profit, reaching ₹305 crore for the first quarter of FY2024-2025. This marks a significant increase from the ₹167 crore net profit reported in the same period last year. The company's revenue from operations grew by 15 percent, climbing to ₹5,086 crore from ₹4,418 crore in the previous fiscal. Additionally, Apollo Hospitals' consolidated EBITDA for Q1 FY25 surged 33 percent year-on-year, reaching ₹675 crore. The stock has also performed well, gaining nearly 32 percent over the last year and over 17 percent in 2024 YTD.
Tata Steel: Tata Steel, a key entity within the Tata Group, posted a robust 75 percent increase in consolidated net profit, reaching ₹919 crore for the quarter, up from ₹525 crore in the same period last year. However, the company's total income from operations saw an 8 percent decline, falling to ₹54,771 crore compared to ₹59,490 crore in the previous year. On the other hand, EBITDA grew by 11.4 percent, rising to ₹6,822 crore from ₹6,122 crore during the same period. Over the last year, Tata Steel's stock has risen by 26 percent, with a 6 percent gain in 2024 YTD.
Maruti Suzuki: India's largest carmaker, Maruti Suzuki, reported a 46.9 percent year-on-year (YoY) increase in standalone profit for the June quarter, reaching ₹3,650 crore, exceeding the Street estimate of ₹3,467 crore. However, Q1 revenue rose 9.82 percent YoY to ₹33,875 crore, falling short of the expected ₹34,770 crore. In a regulatory filing, Maruti Suzuki attributed the profit surge to cost reduction efforts, favorable commodity prices, and favorable foreign exchange rates. On a sequential basis, however, the company saw a 5.9 percent decline in profit and a 7.7 percent drop in net sales. The stock has risen 29.5 percent over the last year and 18.5 percent in 2024 YTD.
Tata Motors: Tata Motors Ltd reported a 74 percent year-on-year increase in its Q1 FY25 consolidated net profit, reaching ₹5,566 crore, up from ₹3,203 crore. This result exceeded Street expectations. The Mumbai-based automaker reported a 5.7 percent rise in revenue from operations, totaling ₹1,07,316 crore for the April-June period, compared to ₹1,01,528 crore a year ago. Consolidated EBITDA increased by 19 percent year-on-year to ₹15,785 crore, with the operating margin expanding to 14.6 percent from 12.9 percent in the previous year. Jaguar Land Rover (JLR), Tata Motors' luxury arm, saw a 5.4 percent rise in revenue during April-June to GBP 7.3 billion, with EBIT margins improving by 30 basis points to 8.9 percent, driven by favorable volume, mix, and material cost improvements. The stock has surged over 72 percent in the last year and nearly 40 percent in 2024 year-to-date.
These companies have demonstrated robust earnings growth, highlighting their resilience and ability to capitalise on favorable market conditions. Investors looking to leverage the ongoing earnings momentum might consider these top-performing stocks as potential additions to their portfolios.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
