Quarterly Earnings Landscape

The latest quarter saw 46.0% of companies reporting positive results, a modest improvement from 44.0% in September 2025 and 42.0% in June 2025, though slightly below the 47.0% recorded in March 2025. This oscillation reflects the uneven recovery trajectory across sectors and market capitalisation segments.

Breaking down by market cap, mid-cap companies led the pack with 52.0% delivering positive earnings, outperforming large caps at 43.0% and small caps at 45.0%. This trend underscores the growing investor confidence in mid-sized firms, often seen as more agile and better positioned to capitalise on niche opportunities amid macroeconomic headwinds.

Sectoral and Company Highlights

Among large caps, Muthoot Finance stood out with robust performance in the Non-Banking Financial Company (NBFC) sector, benefiting from sustained demand for gold-backed loans and prudent risk management. The company’s earnings beat consensus estimates, reinforcing its defensive qualities in a volatile environment.

Mid-cap results were led by FSN E-Commerce, which continues to capitalise on the expanding digital retail market. The company reported strong revenue growth driven by increased consumer adoption and improved logistics efficiencies, signalling resilience in the e-retail sector despite inflationary pressures.

In the small-cap space, Quality Power El from the Heavy Electrical Equipment sector delivered impressive results, reflecting a rebound in industrial demand and government infrastructure spending. The company’s margin expansion and order book growth were key positives that buoyed investor sentiment.

Micro Cap and Notable Performers

Micro-cap stocks also featured prominently, with Trescon in the Realty sector and Jindal Poly Investment & Finance Company Ltd (NBFC) delivering standout performances. Jindal Poly Investment & Finance, in particular, posted an extraordinary quarter with net sales surging to ₹961.80 crores, a staggering growth of 12,230.77% year-on-year. Its profit before tax (excluding other income) soared to ₹839.56 crores, up 2,360.61%, while net profit after tax reached ₹702.05 crores, marking a 2,000.1% increase.

The company’s operating profit margin was near perfect at 99.99%, with earnings per share (EPS) hitting an all-time high of ₹667.98. This remarkable turnaround has shifted the company’s outlook from mildly bullish to bullish as of 6 February 2026, reflecting strong operational execution and market confidence.

Aggregate Profit Growth and Market Implications

Despite pockets of strong growth, aggregate profit growth across the broader market remains subdued, with less than half of companies reporting positive earnings. The persistence of inflationary pressures, supply chain disruptions, and cautious consumer spending continue to weigh on corporate profitability.

Large caps, traditionally viewed as market bellwethers, have shown slower earnings momentum, partly due to their exposure to global economic uncertainties and regulatory challenges. Conversely, mid caps’ outperformance suggests investors are seeking growth opportunities in companies with more focused business models and domestic market orientation.

Small caps, while showing some resilience, remain vulnerable to volatility and liquidity constraints, which may temper near-term gains. Investors are advised to carefully analyse sectoral fundamentals and company-specific catalysts before positioning in this segment.

Upcoming Earnings to Watch

Looking ahead, several key companies are scheduled to announce results in the coming days, including VLS Finance Ltd on 15 February 2026, Sejal Glass Ltd on 16 February 2026, and ABB India Ltd on 19 February 2026. These results will provide further clarity on sectoral trends and earnings sustainability as the fiscal year progresses.

Investor Takeaways

For investors, the current earnings season underscores the importance of selective stock picking and sectoral diversification. Mid-cap companies with strong growth prospects and improving profitability metrics appear well-positioned to deliver superior returns. Meanwhile, large caps with defensive characteristics remain relevant for risk-averse portfolios.

Micro and small caps offer opportunities for outsized gains but require diligent research and risk management given their higher volatility. Monitoring upcoming earnings announcements and management commentary will be crucial to gauge the evolving market landscape.

Conclusion

The December 2025 quarter earnings season paints a complex picture of the Indian equity market, with mid caps leading the charge amid a mixed overall performance. While challenges persist, pockets of robust growth and operational excellence provide optimism for the months ahead. Investors should remain vigilant and focus on quality fundamentals to navigate this evolving environment effectively.

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