Nifty 50’s Projected Growth in FY25: Key Insights from Axis Securities
As the earnings season kicks off, the Nifty 50 index is expected to show a revenue growth of 4.5% for the second quarter of fiscal year 2025 (FY25), according to Axis Securities. The report forecasts a growth in revenue, EBITDA, and PAT of 4.5%, 6%, and 4.1% respectively.
Excluding cyclical sectors like Oil & Gas and Metals, Nifty’s performance is anticipated to be stronger, with revenue, EBITDA, and PAT growth projected at 6.7%, 11.3%, and 10.2% respectively. Key factors influencing this growth include favorable rainfall, increased e-way bill generation, robust GST collections, and higher cargo traffic.
The report also highlights the impact of fluctuating oil prices and positive signals for rural recovery in the latter half of FY25, driven by a normal monsoon and government initiatives. Sectoral growth is expected in Financials, IT, Telecom, Healthcare, and Utilities, while cyclical sectors may see a decline.
Investor attention will be on company commentary regarding profit margins and future guidance for FY25, which will be crucial for market sentiment and investment decisions.
Doubts Revealed
Nifty 50 -: Nifty 50 is a stock market index in India that represents the performance of 50 major companies listed on the National Stock Exchange (NSE). It helps investors understand how the stock market is doing.
FY25 -: FY25 stands for the financial year 2025. In India, a financial year starts on April 1st and ends on March 31st of the next year. So, FY25 will be from April 1, 2024, to March 31, 2025.
Axis Securities -: Axis Securities is a company in India that provides financial services like stock trading and investment advice. They analyze market trends and give insights to help investors make decisions.
Cyclical sectors -: Cyclical sectors are parts of the economy that do well when the economy is growing and not so well when it’s not. Examples include industries like automobiles and construction.
E-way bill -: An e-way bill is an electronic document required for the movement of goods in India. It helps track goods and ensures taxes are paid correctly.
GST collections -: GST stands for Goods and Services Tax, which is a tax on goods and services sold in India. GST collections refer to the total amount of money collected by the government from this tax.
Sectoral growth -: Sectoral growth means the increase in business activity and revenue in specific parts of the economy, like Financials, IT, Telecom, Healthcare, and Utilities.
Profit margins -: Profit margins are the difference between how much money a company makes from selling its products and how much it costs to make them. Higher profit margins mean the company is making more money.
Future guidance -: Future guidance is when a company shares its expectations or plans for the future, like how much money they think they will make or what new projects they will start.