Overall Earnings Trend and Positive Result Proportions

The December quarter saw 49.0% of companies reporting positive results, a notable rise from 43.0% in September 2025 and 40.0% in June 2025, indicating a gradual improvement in corporate earnings momentum. This upward trend, however, remains fragile given the oscillations observed in the previous quarters, with March 2025 recording 44.0% positive results. The incremental rise suggests cautious optimism among companies navigating a challenging macroeconomic backdrop.

Market Capitalisation Segmentation Highlights

Dissecting the results by market capitalisation reveals a clear disparity. Mid-cap stocks led the pack with 54.0% reporting positive earnings, followed by small caps at 50.0%. Large caps, in contrast, lagged significantly with only 37.0% positive results. This divergence highlights the relative resilience and growth potential of mid and small caps amid a period of economic recalibration, while larger companies face headwinds from global uncertainties and sector-specific pressures.

Sectoral Standouts and Top Performers

Among large caps, TVS Motor Co. emerged as a top performer within the automobile sector, demonstrating robust operational execution and steady demand recovery. The company’s ability to navigate supply chain constraints and maintain margin discipline contributed to its standout quarterly performance.

In the mid-cap space, GE Vernova T&D from the heavy electrical equipment sector delivered strong results, benefiting from increased infrastructure spending and favourable government policies supporting power transmission and distribution projects. This sectoral tailwind has bolstered earnings growth and investor confidence.

Small caps also showcased notable performers such as Cupid in the FMCG sector, which reported solid volume growth and margin expansion driven by product innovation and enhanced distribution reach. Additionally, Indo Thai Securities in the capital markets sector capitalised on increased market activity and improved brokerage revenues, further supporting the small cap segment’s positive earnings trajectory.

Micro Cap Excellence

At the micro cap level, String Metaverse from the paper, forest, and jute products sector stood out with exceptional results, reflecting niche market leadership and operational efficiencies. This company’s performance underscores the potential for select micro caps to deliver outsized returns despite broader market volatility.

Spotlight on Pharmaceuticals: Ind-Swift Laboratories’ Strong Quarter

Among the 74 results declared in the last 24 hours, Ind-Swift Laboratories Ltd. delivered a very positive financial performance for the December 2025 quarter. The company’s net sales for the half year surged by 115.61% to ₹303.49 crores, while quarterly profit after tax (PAT) soared by 371.8% to ₹12.94 crores. Operating profit margin also improved, with PBDIT reaching a record ₹4.18 crores and operating profit to net sales ratio hitting 2.77%, the highest in recent quarters.

Ind-Swift’s score improved significantly from 9 to 24 over the past three months, reflecting enhanced operational efficiency and strong demand for its pharmaceutical and biotechnology products. The stock’s sideways movement from a mildly bearish stance on 30 January 2026 at ₹113.34 suggests consolidation ahead of further upside potential.

Upcoming Earnings to Watch

Investors will closely monitor results from key companies scheduled to report shortly, including Hyundai Motor India Ltd, Bajaj Housing Finance Ltd, and Indus Towers Ltd on 2 February 2026. These companies operate in sectors critical to economic growth and consumer demand, and their earnings will provide further clarity on sectoral trends and market sentiment.

Aggregate Profit Growth and Market Implications

The aggregate profit growth across the 960 stocks remains uneven, with mid and small caps driving the bulk of earnings expansion. Large caps’ subdued performance reflects ongoing challenges such as inflationary pressures, input cost volatility, and geopolitical uncertainties impacting global supply chains. Nevertheless, the gradual improvement in positive result proportions signals that companies are adapting to the evolving economic landscape.

Sectoral patterns indicate that capital goods, FMCG, pharmaceuticals, and select financial services are emerging as pockets of strength, while commodity-linked and export-oriented sectors face headwinds. This divergence necessitates a selective investment approach, favouring companies with strong balance sheets, pricing power, and growth visibility.

Investor Takeaways

For investors, the current earnings season underscores the importance of discerning quality within market segments. Mid-cap and small-cap stocks continue to offer attractive growth prospects, supported by favourable sectoral dynamics and nimble management strategies. Large caps, while facing near-term pressures, may present value opportunities as global conditions stabilise.

Monitoring upcoming results from marquee companies will be crucial to gauge the sustainability of earnings momentum. Additionally, tracking margin trends and cash flow generation will help identify firms best positioned to navigate inflationary and interest rate challenges.

Conclusion

The December 2025 quarterly earnings season paints a picture of cautious recovery with clear sectoral and market cap-based disparities. While mid and small caps lead the charge with improving profitability and positive surprises, large caps remain under pressure. Select micro caps continue to surprise with turnaround stories and niche leadership. Investors are advised to maintain a balanced portfolio approach, focusing on quality growth stocks and monitoring evolving macroeconomic signals closely.

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