India Strategy Report Back
India Strategy: Turbulence behind; clear skies ahead

  • As we prepare estimates for 2QFY18, we can't help but notice the slight moderation in the Indian macro story – weaker than expected GDP growth for 1QFY18, higher crude prices and some teething troubles pertaining to GST implementation.  That said, our Economist, Nikhil Gupta believes that the worst is behind as far as GDP growth is concerned. Post-GST restocking and an early festive season should help 2QFY18 performance of India Inc.
  • We expect MOSL Universe PAT to grow 23.4% YoY, but just 4% YoY excluding OMCs, PSU Banks and Metals. Growth will be led by Cyclicals like Metals, PSU Banks, OMCs, while Defensives are expected to post the fourth consecutive quarter of profit decline, dragged by IT and Healthcare.
  • We maintain our FY18/FY19 Nifty EPS estimates at INR487/INR602 and introduce our FY20 Nifty EPS estimate at INR693. We expect Nifty EPS to grow15%/24% in FY18/FY19.