Quarterly Earnings Overview and Positive Result Trends

The December quarter saw a significant uptick in the proportion of companies reporting positive earnings, with 77.0% of the 53 stocks declaring results posting favourable outcomes. This marks a sharp improvement compared to the preceding quarters, where positive results hovered between 40.0% and 44.0% from March through September 2025. The surge in positive earnings suggests an improving corporate earnings environment as companies navigate a complex macroeconomic backdrop.

Breaking down by market capitalisation, mid-cap companies delivered an impeccable performance with 100.0% reporting positive results, underscoring their resilience and growth potential. Small caps also performed strongly, with 79.0% positive results, while large caps lagged considerably at 34.0%. This disparity highlights the ongoing rotation of investor interest towards smaller and mid-sized firms, which appear to be capitalising on niche opportunities and operational agility.

Sectoral and Company-Specific Highlights

Among large caps, HCL Technologies stood out in the Computers - Software & Consulting sector, delivering robust earnings that contributed to the sector’s relative stability. The company’s results reflected steady revenue growth and margin improvement, reinforcing its position as a bellwether in the IT services space.

Mid-cap results were led by Bank of Maharashtra, a public sector bank that demonstrated strong credit growth and improved asset quality, driving a notable rise in profitability. The bank’s performance signals a gradual recovery in the banking sector, supported by easing credit costs and higher net interest margins.

Small caps delivered the most impressive individual performances, with Indo Thai Securities Ltd. in the Capital Markets sector posting outstanding financials. Indo Thai Securities reported net sales of ₹27.71 crores for the quarter, a remarkable 125.6% increase compared to its previous four-quarter average. Profit before tax (excluding other income) surged by 224.8% to ₹22.49 crores, while profit after tax soared 218.4% to ₹17.00 crores. These figures represent the highest quarterly levels recorded by the company, including an EPS of ₹13.98 and cash and cash equivalents reaching ₹140.83 crores at half-year end.

Aggregate Profit Growth and Earnings Quality

The aggregate profit growth across the declared results reflects a strong rebound, particularly driven by mid and small caps. The surge in profitability at Indo Thai Securities exemplifies the quality of earnings improvement seen in the small-cap universe, where operational leverage and sector tailwinds have played a pivotal role. The company’s elevated cash reserves further enhance its financial flexibility, positioning it well for future growth opportunities.

Large caps, however, continue to face headwinds from subdued demand and margin pressures, which have restrained their earnings growth. The relatively low proportion of positive results in this segment suggests that investors should remain selective, focusing on companies with clear earnings visibility and strong balance sheets.

Market Outlook and Upcoming Results

Looking ahead, the market anticipates key results from heavyweight names such as HDB Financial Services Ltd, Union Bank of India, and Infosys Ltd scheduled for 14 January 2026. These results will be closely watched for indications of sustained momentum in financial services and IT sectors, which have been pivotal in shaping market sentiment.

Investors are advised to monitor sectoral trends carefully, as pockets of strength in mid and small caps continue to emerge, while large caps may require more cautious appraisal amid ongoing macroeconomic uncertainties.

Summary of Key Performers

The top performers for the quarter include:

• Indo Thai Securities Ltd. (Small Cap, Capital Markets) – Exceptional growth in sales and profits, highest EPS and cash reserves recorded.


• Navkar Corporation (Small Cap, Transport Services) – Demonstrated strong operational performance and revenue growth.


• Krishna Phosphates (Small Cap, Fertilisers) – Benefited from sector tailwinds with improved margins and profitability.

These companies exemplify the dynamic growth potential within the small-cap segment, driven by sector-specific catalysts and efficient management execution.

Investor Takeaways

The December 2025 quarterly results season underscores a bifurcated market landscape. Mid and small caps are delivering robust earnings growth and positive surprises, supported by favourable sectoral dynamics and operational efficiencies. Large caps, while more stable, are facing challenges that temper their earnings outlook.

For investors, this environment calls for a nuanced approach that balances exposure across market caps, with a focus on quality earnings, strong cash flows, and sectoral leadership. The upcoming results from major financial and IT companies will provide further clarity on the sustainability of the current earnings momentum.

Conclusion

In sum, the December quarter results reveal a market in transition, with mid and small caps leading the recovery in corporate profitability. The strong performance of companies like Indo Thai Securities highlights the opportunities available in niche sectors and smaller market segments. Meanwhile, large caps require selective stock picking amid ongoing margin pressures. As the earnings season progresses, investors should remain vigilant and capitalise on emerging trends to optimise portfolio returns.

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