Quarterly Results Overview and Trends

The latest quarter saw 46.0% of companies reporting positive earnings, a marginal increase from 44.0% in September 2025 and 42.0% in June 2025, though slightly below the 47.0% recorded in March 2025. This indicates a tentative but steady improvement in corporate profitability as businesses navigate ongoing macroeconomic challenges and demand fluctuations. The trend suggests cautious optimism among companies, with some sectors gaining momentum while others remain under pressure.

Market capitalisation-wise, mid-cap companies led the pack with 53.0% posting positive results, outperforming both large caps at 43.0% and small caps at 45.0%. This outperformance by mid-caps highlights their relative agility and growth potential in the current environment, often benefiting from niche market positions and less exposure to global headwinds compared to their larger counterparts.

Sectoral and Market Cap Highlights

Among large caps, Muthoot Finance stood out with robust results in the Non-Banking Financial Company (NBFC) sector, demonstrating resilience amid tightening credit conditions. The company’s ability to sustain growth in net interest margins and asset quality contributed to its strong quarterly performance, reinforcing investor confidence in the NBFC space.

Mid-cap companies also delivered notable performances, with FSN E-Commerce emerging as a top performer in the E-Retail sector. The company’s focus on expanding its digital footprint and optimising logistics has translated into improved revenue growth and margin expansion, reflecting the ongoing shift in consumer behaviour towards online shopping.

In the small-cap segment, Ashiana Housing from the Realty sector reported encouraging results, supported by steady demand in residential real estate and improved execution capabilities. This was complemented by micro-cap leaders such as Jindal Poly Inve (NBFC) and Trescon (Realty), which posted strong earnings growth, signalling pockets of strength in smaller, more specialised companies.

Detailed Company Performance: Schaeffler India Ltd

Among the recent declarations, Schaeffler India Ltd, a key player in the Auto Components & Equipment industry, reported its December 2025 quarter results with marked improvement. The company’s net sales reached a record ₹2,724.20 crores, while PBDIT surged to ₹484.12 crores, both highest in recent quarters. Profit before tax excluding other income stood at ₹390.49 crores, and net profit after tax rose to ₹322.36 crores, reflecting a robust 21.0% growth compared to the previous four-quarter average.

Earnings per share (EPS) also hit a peak at ₹20.62, signalling enhanced operational efficiency and favourable market conditions. Schaeffler India’s financial score improved significantly from 9 to 16 over the last three months, indicating a positive shift in fundamentals and investor sentiment. The stock’s sideways movement from a mildly bearish stance on 24 February 2026 at ₹4,081.20 suggests consolidation ahead of potential further gains.

Sectoral Implications and Broader Market Context

The mixed results across sectors and market caps reflect the ongoing recalibration of corporate strategies amid evolving economic conditions. NBFCs continue to demonstrate resilience, supported by improving asset quality and cautious credit growth. The E-Retail sector’s strong showing underscores the accelerating digital transformation and consumer preference shifts, while Realty companies’ performance points to a gradual revival in real estate demand.

Large caps, despite their scale and market influence, have faced headwinds from global uncertainties and inflationary pressures, which have constrained margin expansion. Conversely, mid-caps’ higher positive result ratio highlights their nimbleness and ability to capitalise on emerging opportunities. Small and micro caps, while more volatile, have shown selective strength, particularly in specialised sectors such as NBFCs and Realty.

Outlook and Investor Considerations

As the earnings season progresses, investors should closely monitor companies’ guidance and margin outlooks, especially in sectors sensitive to interest rates and commodity prices. The gradual improvement in positive result proportions suggests a stabilising corporate earnings environment, but caution remains warranted given geopolitical risks and inflationary trends.

Mid-cap companies with strong momentum and improving fundamentals may offer attractive opportunities, particularly those in sectors benefiting from structural growth trends such as digital commerce and financial services. Meanwhile, large caps with robust balance sheets and diversified revenue streams could provide defensive qualities amid market volatility.

Upcoming results from companies like Sanofi India Ltd, KSB Ltd, and Foseco India Ltd on 25 February 2026 will provide further clarity on sectoral dynamics and earnings sustainability heading into the new fiscal year.

Conclusion

The December 2025 quarter earnings season paints a picture of cautious recovery with pockets of strength across market capitalisations and sectors. While the overall proportion of positive results has inched upwards, the divergence between mid-cap outperformance and large-cap challenges highlights the importance of selective stock picking. Investors are advised to focus on companies demonstrating consistent earnings growth, improving operational metrics, and strong market positioning to navigate the evolving economic landscape effectively.

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