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Q1 FY23 Interim Earnings Review – Below Expectations: Motilal Oswal

Q1 FY23 Interim Earnings Review – Below Expectations: Motilal Oswal

<div class="paragraphs"><p>Stock prices. (Source: pxhere<strong>)</strong></p></div>
Stock prices. (Source: pxhere)

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Motilal Oswal Report

As of July 31, 2022, 110/31 companies within our universe/Nifty have announced their results. The companies that have reported their earnings so far comprise:

  1. 69% of estimated profit after tax for our universe,

  2. 67% of estimated PAT for the Nifty,

  3. 54% of India's market capitalisation, and

  4. 80% weightage in the Nifty.

The earnings growth in Q1 FY23 has been subdued and led solely by banking, financial services and insurance, which has driven 124% of incremental YoY earnings growth for our universe so far, aided by credit cost moderation. Loan growth has spiked fueled by continued momentum in retail and SME segments. Oil and gas and automobiles have been laggards while metals and cement sectors posted weak numbers expectedly.

Profits of the aforesaid 110 our universe companies grew 13.5% YoY (our estimate: 18% YoY). Excluding BFSI, profits have declined 4.3% YoY (versus estimate up 6%).

Around 30/32 companies within our coverage universe witnessed an upgrade/downgrade of more than 3% each, respectively, leading to a balanced upgrade-to-downgrade ratio for FY23E. However, Ebitda margin of our universe (excluding financials) contracted 520 bps YoY to 14.1%.

Click on the attachment to read the full report:

Motilal Oswal Interim Earnings Q1FY23 Review.pdf

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