Healthy order books may lift bottom lines in capital goods sector in Q3

Benign raw material costs, execution of healthy order book to aid growth, say analysts

For India’s capital goods and engineering firms, analysts expect a steady profitability streak for the December 2024-ended quarter (Q3FY25) even as a slump in stock market valuation is seen over order book growth concerns.

 

The Bloomberg analysts’ consensus shows a double-digit growth likely for all three metrics — net sales, earnings before interest, taxation, depreciation and ammortisation (Ebitda) and profit after tax (PAT), for most companies in this segment (see chart).

 

Analysts with brokerage firm Motilal Oswal, in a December note, said, “We expect a 20 basis points (bps) year-on-year (Y-o-Y) expansion in Ebitda margin for our coverage universe. For