Overall Earnings Landscape and Quarterly Trends

The aggregate results for the December quarter show a slight uptick in the proportion of companies reporting positive earnings surprises, rising to 46.0% from 44.0% in the September 2025 quarter. This marks a continuation of a gradual improvement from the June quarter’s 41.0%, although it remains below the 47.0% recorded in March 2025. The oscillation suggests ongoing volatility in corporate earnings amid fluctuating demand conditions and input cost pressures.

Sectoral performance remains uneven, with financial services and realty sectors delivering some of the strongest results, while others such as pharmaceuticals and consumer goods showed mixed outcomes. The aggregate profit growth for the quarter, while not uniformly disclosed, appears to be modestly positive, supported by select large and mid-cap companies posting robust top-line and bottom-line expansions.

Market Capitalisation Segmentation: Winners and Laggards

Mid-cap companies have outperformed their large and small-cap counterparts in terms of positive earnings results, with 53.0% of mid-caps reporting beats or in-line results. This contrasts with 43.0% for large caps and 45.0% for small caps, highlighting the relative resilience and growth potential in the mid-cap segment. Investors may find this segment attractive given its demonstrated ability to navigate economic headwinds and deliver earnings growth.

Among large caps, Muthoot Finance, a leading non-banking financial company (NBFC), stood out with strong earnings driven by sustained loan growth and improved asset quality. The company’s disciplined credit approach and steady net interest margin expansion contributed to a notable profit increase, reinforcing its position as a sectoral bellwether.

In the mid-cap space, FSN E-Commerce delivered impressive results, benefiting from robust consumer demand and expanding market share in the e-retail sector. Its revenue growth outpaced sector averages, supported by operational efficiencies and strategic marketing investments.

Small caps showed pockets of strength, with Ashiana Housing in the realty sector reporting solid sales and margin expansion, reflecting improving demand in residential real estate markets. However, small caps overall remain more vulnerable to economic fluctuations and capital market volatility.

Micro and Small Cap Highlights

Micro-cap stocks delivered some of the most remarkable earnings performances this quarter. Jindal Poly Inve, another NBFC, posted strong profit growth driven by expanding loan book and improved collections. Similarly, Trescon in the realty sector and Indo Thai Securities in capital markets reported robust earnings, underscoring the potential for select micro and small caps to outperform despite broader market uncertainties.

These companies’ results highlight the importance of stock-specific fundamentals and sectoral tailwinds in driving earnings growth, even as macroeconomic challenges persist.

Sanofi Consumer Healthcare India Ltd: A Standout Performer

Among recent declarations, Sanofi Consumer Healthcare India Ltd reported a very positive quarter for December 2025, with net sales reaching ₹251.00 crores, marking a 25.8% growth compared to its previous four-quarter average. The company’s PBDIT rose to ₹89.80 crores, while profit before tax excluding other income stood at ₹85.90 crores, up 27.2%. Net profit after tax surged 23.8% to ₹66.50 crores, with earnings per share hitting a record ₹28.91.

Despite a recent shift in market sentiment from mildly bearish to bearish since early December 2025, Sanofi’s financial performance has improved significantly, reflected in its Mojo score rising from 15 to 24 over the past three months. This turnaround underscores the company’s operational resilience and effective cost management in a competitive pharmaceuticals and biotechnology sector.

Sectoral Earnings Patterns and Outlook

The NBFC sector continues to demonstrate robust earnings momentum, supported by improving credit demand and asset quality. Companies like Muthoot Finance and Jindal Poly Inve exemplify this trend, with steady profit growth and cautious risk management.

Realty firms such as Ashiana Housing and Trescon have benefited from a gradual revival in housing demand and favourable interest rate conditions, translating into better sales and margin expansion. However, the sector remains sensitive to regulatory changes and input cost inflation.

E-retail and e-commerce companies, led by FSN E-Commerce, are capitalising on shifting consumer behaviour and digital penetration, driving revenue growth and operational leverage. This sector is expected to remain a key growth driver in the near term.

Pharmaceuticals and biotechnology firms showed mixed results, with Sanofi Consumer Healthcare India Ltd standing out as a positive exception. The sector faces challenges from pricing pressures and regulatory scrutiny but also opportunities from innovation and expanding healthcare demand.

Upcoming Earnings to Watch

Investors should keep an eye on the upcoming results of companies such as Rain Industries Ltd, Enkei Wheels India Ltd, and Jagatjit Industries Ltd, all scheduled to report on 27 February 2026. These results will provide further clarity on sectoral trends and earnings momentum heading into the new fiscal year.

Conclusion: Navigating a Mixed Earnings Environment

The December 2025 earnings season reflects a cautiously optimistic corporate India, with mid-cap companies leading the recovery in profitability and revenue growth. Large caps have shown resilience but lagged mid-caps in positive earnings surprises, while small and micro caps delivered pockets of strong performance amid broader volatility.

Sectoral disparities remain pronounced, with NBFCs, realty, and e-commerce firms emerging as key beneficiaries of improving demand and operational efficiencies. Meanwhile, pharmaceuticals and consumer sectors face headwinds but also demonstrate selective strength.

For investors, the current environment underscores the importance of selective stock picking, focusing on companies with strong fundamentals, sustainable earnings growth, and sectoral tailwinds. Monitoring upcoming earnings and macroeconomic developments will be crucial to navigating the evolving market landscape effectively.

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