Companies started announcing first quarter earnings last week. Analysts expect flat to negative revenue growth in the quarter gone by.
Surendra Goyal of Citi says he expects Citi coverage universe Q1FY17 earnings to be flattish (YoY).
"Earnings, ex-commodities, are expected to be up 6 percent (YoY) versus a sharp decline in Q4FY16. Q1FY17 earnings are nearly 23 percent of our FY17 expectation," he explains.
He remains constructive with nearly 6 percent upside to 1-year target of 28,800 for the Sensex. "The Sensex is up 10 percent over the past 3 months and we would see enhanced buying opportunities on any dips," Goyal says.
Meanwhile, Ridham Desai of Morgan Stanley says headline numbers are likely to look poor, but inside them earnings could show some life with several sectors likely to report double-digit EBITDA growth.
For the Morgan Stanley coverage universe, analysts expect revenue and net profit growth of 2 percent and -6 percent (YoY), he says.
According to him, within Sensex companies, BHEL, GAIL and Lupin, are likely to see the fastest growth in earnings while Cipla, ICICI Bank and ONGC will likely be the laggards.
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