Quarterly Earnings Overview and Trends

The latest quarter saw 52.0% of companies reporting positive results, marking a notable improvement from the 43.0% in September 2025 and 40.0% in June 2025. This upward trend suggests a gradual recovery in corporate profitability after a subdued first half of the fiscal year. However, the proportion of positive results remains modest, reflecting persistent headwinds in various sectors.

Sectoral and market cap-wise analysis reveals a divergence in performance. Large caps lagged with only 37.0% positive results, whereas mid caps and small caps posted stronger showings at 55.0% and 54.0% respectively. This pattern indicates that smaller companies are currently better positioned to capitalise on niche opportunities and operational efficiencies, while larger firms face more structural challenges.

Large Cap Highlights: TVS Motor Co. Leads Automobiles Sector

Among large caps, TVS Motor Co. emerged as a standout performer within the automobile sector. The company reported robust revenue growth and margin expansion, driven by strong domestic demand and improved product mix. Despite inflationary pressures on raw materials, TVS Motor managed to increase its profit before tax by a healthy margin compared to the previous quarter.

However, the overall large cap segment showed restrained earnings growth, weighed down by subdued performance in capital goods and energy sectors. Investors remain cautious as global supply chain disruptions and commodity price volatility continue to impact earnings visibility for heavyweight companies.

Mid Cap Momentum: GE Vernova T&D Shines in Heavy Electrical Equipment

Mid cap companies demonstrated resilience with GE Vernova T&D delivering impressive results in the heavy electrical equipment sector. The firm posted strong order inflows and revenue growth, supported by government infrastructure spending and renewable energy projects. Profit after tax (PAT) growth exceeded 20% year-on-year, signalling operational leverage and cost control measures paying off.

This mid cap strength is echoed across other sectors, where nimble companies are leveraging innovation and market agility to outperform peers. The mid cap segment’s 55.0% positive result ratio underscores its growing importance in driving market returns.

Small and Micro Cap Performers: Indo Thai Sec. and String Metaverse Lead

Small caps maintained their strong showing with 54.0% positive results. Indo Thai Securities, operating in the capital markets sector, delivered one of the top results in this category, benefiting from increased market activity and higher brokerage income. The company’s earnings growth was supported by improved operational efficiencies and cost rationalisation.

Micro caps also featured prominently, with String Metaverse from the paper, forest & jute products sector posting the best overall results. The company’s niche positioning and innovative product offerings helped it achieve significant revenue and profit growth despite challenging raw material costs. Another micro cap, STEL Holdings Ltd., operating in the Non-Banking Financial Company (NBFC) sector, reported outstanding quarterly performance, underscoring the potential for high growth in select smaller firms.

STEL Holdings Ltd.: A Case Study in Exceptional Growth

STEL Holdings Ltd. declared its December 2025 quarter results with remarkable financial metrics. Net sales surged by 203.0% compared to the previous four-quarter average, reaching ₹17.20 crores. Profit before tax (excluding other income) rose by 199.8% to ₹17.05 crores, while profit after tax grew by 194.8% to ₹12.58 crores. The company also recorded its highest-ever earnings per share (EPS) at ₹6.81 for the quarter.

This performance marks a significant turnaround from a mildly bearish stance on 27 January 2026, with the company’s score improving from 13 to 36 over the last three months. STEL Holdings’ robust growth is attributed to strong demand in its NBFC segment and effective cost management, positioning it as a key beneficiary of the current economic cycle.

Aggregate Profit Growth and Sectoral Patterns

Overall, the aggregate profit growth across the 604 companies declaring results indicates a cautious but positive earnings environment. Mid and small caps are driving this momentum, supported by sectors such as capital markets, heavy electrical equipment, and niche manufacturing. Large caps, while showing pockets of strength, continue to face margin pressures and slower growth trajectories.

Sectoral patterns reveal that consumer discretionary and automobile sectors are benefiting from pent-up demand and easing supply constraints. Conversely, capital goods and energy sectors are grappling with input cost inflation and subdued order books. Financial services, particularly NBFCs, are emerging as bright spots with strong credit demand and improving asset quality.

Upcoming Results to Watch

Investors will closely monitor the results of heavyweight companies scheduled to report shortly, including Jindal Steel Ltd., Nestle India Ltd., and NTPC Ltd. These results will provide further clarity on the sustainability of earnings growth and sectoral trends as the fiscal year progresses.

Market Implications and Investor Takeaways

The December quarter earnings season underscores the importance of selective stock picking, with mid and small caps offering attractive growth opportunities amid a mixed macroeconomic backdrop. Large caps require more cautious evaluation given their exposure to global uncertainties and margin pressures.

Investors should focus on companies demonstrating strong operational execution, robust order pipelines, and prudent cost management. Sectors aligned with infrastructure development, financial services, and consumer demand recovery are likely to remain in favour. Meanwhile, vigilance is warranted in capital-intensive and commodity-linked sectors.

Conclusion

The Dec-2025 quarterly results paint a nuanced picture of India’s corporate earnings landscape. While the overall proportion of positive results has improved to 52.0%, the disparity between market cap segments highlights evolving market dynamics. Mid and small caps are currently leading profit growth, supported by sector-specific tailwinds and operational agility. Large caps, despite some bright spots, face ongoing challenges that may temper near-term earnings momentum.

As the earnings season progresses, investors would do well to balance growth prospects with risk management, leveraging detailed financial analysis to identify sustainable winners in a complex environment.

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