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Last Updated : May 07, 2018 09:01 AM IST | Source: Moneycontrol.com

Over 50% stocks in Morgan Stanley coverage outperform Sensex post their Q4 earnings

The earnings beat ratio stood at 53 percent, while relative stock performance, which is the proportion of Morgan Stanley coverage stocks that outperformed the Sensex a day before and after the results, stood at 58 percent.


After a spell of lacklustre earnings, Indian Inc reported earnings, majority of which were ahead of analyst expectations. A Morgan Stanley report said early indicators suggest topline growth was ahead of expectations, while bottomline growth was inline.

A quarter of Morgan Stanley's covered companies in India have reported revenue and net profit growth of 18 percent on a year-on-year (YoY) basis and three percent YoY, respectively. This translates in a revenue growth beat of five percentage points but a net profit growth miss of six percentage points versus Morgan Stanley’s expectations.

Excluding Axis Bank, net profit growth was 12 percent YoY, broadly inline with its expectations. In totality, more than half of the companies have reported earnings ahead of its estimates.

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The earnings beat ratio stood at 53 percent, while relative stock performance, which is the proportion of Morgan Stanley coverage stocks that outperformed the Sensex a day before and after the results, stood at 58 percent.

Bulk of the earnings reporting thus far is in the financials and technology space. In the technology space, it said the earnings beat ratio stands at 83 percent, but earnings growth is flat.

In case of financials, non-banking financial companies (NBFCs) have reported earnings growth of 47 percent YoY, whereas the same for private banks degrew 21 percent YoY. Excluding Axis Bank, earnings growth is 30 percent YoY.

The brokerage highlighted that as many as 13 Sensex companies have reported revenue and net profit growth of 18 percent YoY and a percent YoY, respectively. Less than 10 percent of broader market companies have reported earnings thus far. Revenue and net profit growth for 192 companies stood at 16 percent and four percent YoY, respectively.

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First Published on May 7, 2018 08:42 am
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