 "Analysts slash FY22 profit estimates; telecom, PSU banking firms suffer")
The corporate landscape has undergone a sea change due to Covid-19. And, so have analysts’ expectation from companies operating in various sector.
An analysis done by Motilal Oswal Financial Services (MOFSL) shows, health care and technology are the only two sectors which have seen an upgrade in FY22 earnings. While the telecom, state-owned banking, and retail sectors have seen the biggest downgrades.
At the start of the year analysts were expecting the PSU banking pack to post a combined net profit of Rs 573 crore in FY22. Now they expect them to clock earnings of just Rs 334 crore.
Among Nifty stocks, Dr Reddy’s, Cipla, and Hindalco have seenthe biggest upward revision in FY22 earnings estimate. IndusInd Bank, Tata Steel, and Axis Bank have seen the sharpest cut. Analysts say firms that have seen a sharp earnings cut will struggle to regain pre-Covid levels.
“At 18.3x estimated FY22 earnings, we believe the market is trading closer to its long-period averages and building in fair amount of earnings recovery in FY22,” said Gautam Duggad, head of research-institutional equities at MOFSL.
One subscription. Two world-class reads.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%