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Jan–March FY26 earnings growth lowered to 10%; mid and small-caps under pressureGautam Duggad, Head of Research, Director - Institutional Equities at Motilal Oswal Financial Services noted that sectoral trends have led to a broader earnings downgrade of around 3% across his coverage universe of over 360 stocks. Within this, midcaps and smallcaps have seen sharper cuts of about 6% each for FY27.By Prashant Nair   |  Reema Tendulkar  April 7, 2026, 11:22:20 AM IST (Published)3 Min ReadEarnings expectations across the market are being steadily revised lower as global uncertainties continue to play out. According to Gautam Duggad, Head of Research, Director - Institutional Equities at Motilal Oswal Financial Services, the situation remains fluid, and forecasts could change quickly depending on how events unfold over the next few weeks.

Duggad said, “This quarter's numbers, we are expecting a growth of about 10% for our coverage universe and 6% for Nifty. This numbers when the third quarter ended, our expectations for the fourth quarter earnings growth was 14% more importantly, the numbers have been cut pretty sharply for FY26 as well.”

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Duggad says that Nifty earnings estimate for FY26 have been trimmed by about 2%, largely reflecting revisions to just one quarter since the first nine months’ numbers are already in place. He added that estimates for the following two years have also been reduced by around 1.5% each.

He emphasised; the broader market presents a clearer picture of the downgrade cycle. Across his coverage universe of nearly 366 companies, earnings estimate for FY27 have been reduced by about 6% for both midcap and smallcap stocks, while largecaps have seen relatively milder cuts of around 1.5%.

The sharpest earnings cuts have been seen in a few key sectors, led by auto. Across his coverage of 27 auto companies, earnings estimates have been reduced by around 5% for FY26 and nearly 11% for FY27, with several companies facing steeper cuts of 15–20% due to the combined impact of higher commodity costs and weaker global demand.

Cement has also seen significant pressure, with FY27 earnings estimates cut by about 12%. Other sectors such as capital goods and EMS have seen cuts of 4–5%, while utilities have witnessed a meaningful downgrade. In contrast, metals have been a key beneficiary, with earnings upgrades for both FY26 and FY27, while oil and gas has seen upgrades for FY26.

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Duggad noted that these sectoral trends have led to a broader earnings downgrade of around 3% across his coverage universe of over 360 stocks. Within this, midcaps and smallcaps have seen sharper cuts of about 6% each for FY27.

He added that IT has seen a modest upgrade of 2–2.5% for FY27, supported by currency movements, although FY26 estimates have been slightly trimmed.

He cautioned that these estimates remain subject to change and could move in either direction depending on how global geopolitical developments and the energy situation evolve over the next few weeks.

Live stock market updates—follow our blogContinue ReadingNote To ReadersDisclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.(Edited by : Unnikrishnan)TagsEarnings estimatesGautam DuggadMarket analystsMarket OutlookMotilal Oswal Financial Servicesnifty