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Nifty 50 cos may post 6% profit growth in Q2 of 2016-17

Net profit for Nifty 50 companies is likely to grow by 6 percent during the second quarter of the current fiscal year-on-year, the highest level in eight quarters, says a report.



Mumbai: Net profit for Nifty 50 companies is likely to grow by 6 percent during the second quarter of the current fiscal year-on-year, the highest level in eight quarters, says a report.

Sales of companies constituting the 50-share well-diversified NSE index are seen to grow 3 percent in the July-September quarter compared with the year-ago period, said the report brought out by leading brokerage Motilal Oswal.

The earnings performance will be driven by domestic cyclicals like automobiles, cement and select private sector banks. Besides, consumer and NBFCs are likely to post healthy growth.

"Nifty PAT (profit after tax) is likely to grow by 6 percent year-on-year in the second quarter of 2016-17 ? the highest in eight quarters," the report predicted.

According to the document, nearly half of the Nifty universe is expected to post 15 percent expansion in net profit, led by autos, paints, cement and certain private banks.

"Another notable feature of this quarter is the year- on-year PAT decline of large-cap technology companies (Infosys, Wipro and Tech Mahindra)," it added.

Its projection is a majority of the growth in earnings will be driven by five companies ? Bank of Baroda, Reliance Industries, Tata Motors, HDFC Bank and Tata Steel.

Stock breadth has been positive in the current calendar year so far, with 36 Nifty shares trading higher.

All technology and telecom stocks on the NSE benchmark index gave negative returns, the report noted.

From Zee News

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