Where markets stand heading into earnings season

Indian equity markets enter this earnings season with valuations broadly in line with long-term averages, following a period of consolidation over the past two months. Sector leadership has been narrow, concentrated in financials and select industrials, while broader participation remains muted.

What to watch

Commentary on margin trends will matter more than headline revenue growth this quarter, particularly for consumer-facing sectors navigating input cost pressures. Management guidance on capex plans will also be closely tracked, given the recent moderation in private capex announcements.

Our positioning view

We continue to favour a quality-first approach within large caps, with selective exposure to mid-caps where earnings visibility is high. We would treat any post-earnings volatility as an opportunity to add to core positions rather than as a reason to reduce exposure.

For specific stock ideas aligned with this view, our subscriber-only model portfolio is updated monthly — speak with your Relationship Manager for access.