Quarterly Earnings Trends and Positive Surprises

The December quarter marked a notable improvement in the share of companies reporting positive results, rising to 53.0% from 42.0% in September 2025 and 40.0% in June 2025. This upward trajectory suggests a gradual recovery in corporate profitability after a subdued first half of the fiscal year. The March 2025 quarter had seen 44.0% positive results, indicating that the latest quarter has surpassed recent trends.

However, this aggregate improvement masks significant divergence when analysed by market capitalisation. Mid-cap companies led the charge with 63.0% reporting positive results, followed by small caps at 54.0%. Large caps lagged considerably, with only 35.0% of firms delivering positive surprises. This disparity highlights the ongoing challenges faced by larger, often more cyclical companies, while mid and small caps appear to be benefiting from niche growth opportunities and operational agility.

Sectoral and Market Cap Highlights

Among large caps, Hindustan Zinc stood out with robust earnings, reflecting strength in the non-ferrous metals sector amid stable commodity prices and improved operational efficiencies. The company’s performance underscores the resilience of select resource-based sectors despite broader market headwinds.

In the mid-cap space, Persistent Systems delivered impressive results, driven by sustained demand in the software and consulting sector. The company’s ability to capitalise on digital transformation trends and maintain margin discipline contributed to its strong showing, reinforcing the sector’s defensive qualities in uncertain economic conditions.

Small caps also showcased notable performers, with Indo Thai Securities from the capital markets sector posting solid earnings growth. This reflects increased activity and investor interest in financial services, particularly in niche brokerage and advisory firms.

Exceptional Performers Among Micro and Small Caps

The micro-cap segment witnessed standout performances, with String Metaverse Ltd from the paper, forest & jute products sector delivering an exceptional quarter. The company reported net sales of ₹278.35 crores, a staggering 140.6% year-on-year growth. Profit before tax (excluding other income) surged by 184.16% to ₹27.45 crores, while net profit after tax rose 171.5% to ₹27.72 crores. These figures represent the highest quarterly levels for the company, with operating profit to net sales ratio reaching 11.42% and earnings per share at ₹2.38.

Despite a slight downgrade in its sentiment score from Bullish to Mildly Bullish in early December 2025, String Metaverse’s financial performance remains outstanding, reflecting strong operational execution and favourable market conditions in its sector.

Other micro-cap companies such as Sera Investments, operating in the Non-Banking Financial Company (NBFC) sector, also reported robust earnings, underscoring the resilience of select financial services firms amid tightening credit conditions.

Aggregate Profit Growth and Market Implications

The aggregate earnings growth across the 321 companies indicates a cautiously optimistic outlook for the Indian equity market. The improvement in positive result proportions, especially among mid and small caps, suggests that investors may find opportunities in segments less correlated with broader economic cycles. Conversely, the subdued performance of large caps signals ongoing challenges in sectors sensitive to global economic fluctuations and commodity price volatility.

Investors should note the sectoral nuances, with technology and financial services continuing to drive mid and small cap earnings, while resource-based large caps show selective strength. This divergence calls for a balanced portfolio approach, favouring companies with strong fundamentals and growth visibility.

Recent Result Highlights and Upcoming Earnings

In the last 24 hours, 71 companies declared results, with String Metaverse Ltd’s performance being the highlight. The company’s strong quarter has set a high benchmark for micro-cap earnings in this cycle.

Looking ahead, key results to watch include Shriram Finance Ltd, Piramal Finance Ltd, and Bharat Petroleum Corporation Ltd, all scheduled to report on 23 January 2026. These companies represent significant sectors—NBFCs and energy—that could influence market sentiment and sectoral trends in the near term.

Conclusion: Navigating a Mixed Earnings Landscape

The December 2025 earnings season reflects a market in transition, with improving corporate profitability tempered by uneven sectoral and market cap performances. Mid and small caps continue to offer pockets of growth and positive surprises, while large caps face headwinds that require careful stock selection.

Investors should remain vigilant, analysing individual company fundamentals and sector dynamics to capitalise on emerging opportunities. The evolving earnings landscape underscores the importance of diversification and active portfolio management in the current market environment.

Summary of Key Metrics:

• Total companies reporting: 321


• Proportion of positive results: 53.0% (Dec-2025), up from 42.0% (Sep-2025)


• Positive results by market cap: Large Cap 35.0%, Mid Cap 63.0%, Small Cap 54.0%


• Top Large Cap performer: Hindustan Zinc (Non-Ferrous Metals)


• Top Mid Cap performer: Persistent Systems (Computers - Software & Consulting)


• Top Small Cap performer: Indo Thai Securities (Capital Markets)


• Top Micro Cap performers: String Metaverse (Paper, Forest & Jute), Sera Investments (NBFC)

Upcoming Earnings to Watch:

• Shriram Finance Ltd – 23 Jan 2026


• Piramal Finance Ltd – 23 Jan 2026


• Bharat Petroleum Corporation Ltd – 23 Jan 2026

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