Q2 Earnings Preview: Here's all you need to know about expectations from various sectors

The September quarter earnings projections reveal a clear trend of robust earnings growth, predominantly fueled by domestic cyclicals.

Net profit of the BSE-30 index is set ot increase by 19% from last year and 2% from the June quarter. Similarly, the Nifty 50 index is likely to show a 23% growth in its bottomline, although that number is likely to remain flat when compared to the June quarter.

The BSE-30 index is likely to report Earnings per Share (EPS) of Rs 3,078 for financial year 2024 and a higher Rs 3,544 for financial year 2025. On the other hand, the Nifty 50 EPS for the current yer is likely to be Rs 952 and rise to Rs 1,076 for financial year 2025.

Majority of the brokerages are anticipating a strong quarter for domestic-oriented companies, although a few sectors like chemicals, defence and largecap IT may continue to underperform.

Here's a look at the sector-wise earnings expectations for the quarter:

Auto, Cement, Capital Goods, FMCG, NBFC and Healthcare are the sectors expected to report strong earnings growth, aided by a fall in raw material prices and better operating leverage.

Single digit earnings growth is expected from sectors like Consumer Discretionary, defence and Largecap IT, while the chemicals sector may report a decline in earnings.

Financials: A strong quarter is expected for loan growth, but most banks are likely to experience a compression in Net Interest Margin (NIM) due to the upward repricing of deposits and the ICRR.

NBFC: Microfinance Institutions (MFI), Gold, and diversified NBFCs are expected to show strong growth with improvements in Net Interest Margin (NIM).

IT: India's top six large IT companies may continue with their sluggish performance during the quarter with projections of -0.8% to 1.5% revenue growth in constant currency terms on a sequential basis. However, Midcap IT stocks are likely to outperform with growth pegged in the range of 2.1%-5.9%.

Oil & Gas: Negative marketing margins in diesel are likely to drag the profitabiity of India's Oil Marketing Companies. Gas stocks may see an improvement in margins led by higher volumes and relatively less volatile global gas prices.

Autos: Falling raw material prices and better operating leverage is likely to result in better margins across the board.

Cement: Cement companies are likely to report volume growth of 12%-14% but their operating profit or EBITDA per Tonne is likely to remain flat on a sequential basis.

Pharma: The major US market is likely to witness a strong quarter driven by gRevlimid contributions and moderation in generics pricing. However, the domestic segment may see a slow down due to a tepid incidence of seasonal infections, which may be offset by price hikes.

Consumer Durables: The outperformance of India's cables and wires industry is likely to continue with stocks like Havells and Polycab. On the other hand, Trent is likely to emerge as an outlier in the apparel sector.

Consumer Staples: These companies are likely to report volume growth in low single-digits and value growth ranging between low-to-mid-single digit.

Speciality Chemicals: Most companies in this sector are expected to have another weak quarter due to continued destocking, demand weakness, and price erosion amid intense competition from Chinese suppliers.