Quarterly Earnings Trends and Positive Result Proportions

The latest quarter saw a marked improvement in the share of companies reporting positive results, rising to 53.0% from 43.0% in September 2025. This marks the highest proportion of positive earnings in the last four quarters, signalling a tentative recovery in corporate profitability. The March and June quarters of 2025 had positive result proportions of 44.0% and 40.0% respectively, underscoring the recent upward momentum.

However, this aggregate improvement masks significant divergence when analysed by market capitalisation. Large caps lagged with only 34.0% of companies delivering positive results, whereas mid caps outperformed strongly with 60.0% positive outcomes. Small caps also showed resilience, with 55.0% of firms beating expectations. This suggests that mid and small cap companies are currently driving earnings growth, potentially benefiting from niche market positions or sectoral tailwinds.

Sectoral and Market Cap Highlights

Among large caps, Piramal Finance stood out with robust earnings, although the sector classification remains unspecified. Mid cap leaders included Laurus Labs, a key player in Pharmaceuticals & Biotechnology, which continues to benefit from strong demand and operational efficiencies. Small cap success stories featured Indo Thai Securities in the Capital Markets sector, reflecting renewed investor interest and market activity.

Micro caps also delivered notable performances, with String Metaverse (Paper, Forest & Jute Products) and Sera Investments (Non-Banking Financial Company) topping the charts. These companies exemplify the potential for outsized returns in smaller, less-followed segments of the market, albeit with higher risk profiles.

Raymond Realty Ltd: A Standout Performer

Among the 53 results declared in the last 24 hours, Raymond Realty Ltd emerged as a clear highlight. The company reported net sales of ₹757.55 crores for the quarter, representing a remarkable 136.7% growth compared to its previous four-quarter average. Operating profit to interest ratio reached a peak of 5.31 times, indicating strong operational leverage and efficient interest cost management.

Profit before tax (excluding other income) surged by 309.5% to ₹68.78 crores, while net profit after tax soared 225.4% to ₹66.79 crores, both marking all-time highs for the company. The PBDIT also hit a record ₹91.45 crores, underscoring the company’s robust earnings quality and margin expansion. These metrics collectively highlight Raymond Realty’s strong turnaround and operational momentum in the realty sector.

Aggregate Profit Growth and Market Implications

The aggregate profit growth across the board is encouraging, particularly among mid and small caps, which have demonstrated resilience amid macroeconomic uncertainties. The rise in positive results to over half of the companies reporting is a positive signal for market sentiment and may support further equity inflows.

However, the subdued performance of large caps, with only a third reporting positive results, suggests caution. Large cap companies often serve as bellwethers for the broader economy, and their muted earnings growth may reflect ongoing challenges such as inflationary pressures, supply chain disruptions, or sector-specific headwinds.

Investors should also note the sectoral disparities, with pharmaceuticals and capital markets sectors showing strength, while other sectors remain less visible in the current earnings cycle. This unevenness calls for selective stock picking and a focus on companies with demonstrable earnings quality and growth visibility.

Upcoming Earnings to Watch

Market participants will closely monitor the results of heavyweight companies scheduled to report shortly, including Vedanta Ltd., ITC Ltd., and REC Ltd. on 29 January 2026. These companies’ earnings will provide further clarity on sectoral trends and the sustainability of the current earnings momentum.

Vedanta’s performance will be particularly scrutinised given its exposure to commodities and metals, sectors sensitive to global demand and pricing dynamics. ITC’s results will offer insights into consumer demand and FMCG sector health, while REC’s earnings will shed light on the financial sector’s credit environment.

Investor Takeaways and Strategic Considerations

Given the current earnings landscape, investors may consider tilting portfolios towards mid and small cap stocks with strong fundamentals and consistent earnings growth. The demonstrated outperformance of these segments suggests opportunities for alpha generation, albeit with a need for careful risk management.

Large cap investors should remain vigilant, focusing on companies with robust balance sheets and defensive business models to navigate ongoing macroeconomic uncertainties. Sectoral rotation towards pharmaceuticals, biotechnology, and capital markets may also be prudent given their recent earnings strength.

Overall, the December 2025 quarter results underscore a market in transition, with pockets of robust growth amid broader caution. A discerning approach, grounded in fundamental analysis and sectoral awareness, will be key to capitalising on emerging opportunities.

Summary

The December 2025 earnings season has delivered a mixed but cautiously optimistic picture. With 53.0% of companies reporting positive results, led by mid and small caps, the market shows signs of recovery. Standout performers like Raymond Realty Ltd highlight the potential for strong earnings growth in select sectors. However, the subdued large cap performance and sectoral disparities warrant a selective investment approach as the market navigates evolving economic conditions.

Unlock special upgrade rates for a limited period. Start Saving Now →