From SBI to Infosys: Brokerage names top Nifty50 stock picks after Q4 results

Motilal Oswal Financial Services said the March quarter earnings season has remained largely in line with expectations so far, while mid-cap companies delivered stronger-than-expected performance.

The brokerage said profit growth during Q4FY26 was mainly supported by metals, banking, automobiles and technology sectors. As of May 6, results of 154 companies under the brokerage’s coverage universe and 28 Nifty companies had been announced.

MOFSL Universe reports 17% profit growth

According to the report, companies in the Motilal Oswal coverage universe reported 17 per cent year-on-year growth in profit after tax during Q4FY26, compared with the brokerage estimate of 13 per cent.

Sales growth stood at 15 per cent year-on-year, while EBITDA and profit before tax rose 13 per cent and 15 per cent, respectively. Excluding metals and oil & gas companies, the MOFSL Universe reported sales, EBITDA, PBT and PAT growth of 15 per cent, 12 per cent, 14 per cent and 16 per cent year-on-year, respectively.

Nifty earnings rise 7%; Reliance weighs on growth

The brokerage said the 28 Nifty companies that announced results so far reported 14 per cent growth in sales, 8 per cent rise in EBITDA, 5 per cent increase in PBT and 7 per cent growth in PAT year-on-year.

Excluding Reliance Industries, which reported a 13 per cent decline in profit, Nifty earnings growth stood at 11 per cent.

The brokerage said earnings growth was mainly led by HDFC Bank, Infosys, TCS, Mahindra & Mahindra and Coal India. These five companies contributed around 73 per cent of incremental earnings growth.

On the other hand, Reliance Industries, Maruti Suzuki, Wipro, Axis Bank and Jio Financial Services dragged overall Nifty earnings lower.

Metals sector leads earnings growth

The brokerage said metals remained the strongest-performing sector during the quarter, with profit growth of 53 per cent year-on-year.

Banking, financial services and insurance companies reported 18 per cent growth, while automobile companies posted 22 per cent growth. Technology sector earnings increased 12 per cent year-on-year.

These four sectors together contributed 96 per cent of the incremental earnings growth in the coverage universe.

Mid-caps outperform estimates

Motilal Oswal said mid-cap companies delivered better-than-expected numbers during the quarter. Large-cap companies under coverage reported 14 per cent year-on-year earnings growth, while mid-cap companies posted 29 per cent growth against the brokerage estimate of 22 per cent.

Small-cap companies reported 30 per cent earnings growth, broadly in line with estimates of 33 per cent.

The brokerage said BFSI, technology, utilities, real estate and oil & gas sectors supported the strong mid-cap performance.

Banks and NBFCs show stable trends

The report said private banks delivered stable net interest margin performance during the quarter, while PSU banks reported slightly weaker-than-expected net interest income and margin trends.

Loan growth remained healthy, and credit-deposit ratios moderated slightly across most banks. Among NBFCs, lending-focused companies delivered strong performance driven by healthy disbursements and improvement in asset quality.

The brokerage said GST rate cuts and seasonal improvement supported business growth for NBFCs.

Consumer demand stable, IT sector under pressure

Motilal Oswal said consumer demand remained broadly stable during the quarter due to lower inflation, improving rural demand and higher affordability following GST rate rationalisation.

In the metals sector, Jindal Steel & Power reported better-than-expected performance due to higher volumes, while Hindustan Zinc delivered a strong earnings beat supported by higher silver revenue.

In oil and gas, the brokerage said sector performance remained weak mainly due to softer profitability at Reliance Industries.

For the technology sector, the brokerage said IT services companies reported median constant currency revenue growth of 1 per cent quarter-on-quarter. It added that large IT companies may face higher growth pressure in FY27.

Companies that beat and missed estimates

Among Nifty companies, Mahindra & Mahindra, Coal India, Infosys, Kotak Mahindra Bank, Adani Ports, Shriram Finance, Nestle India, Trent and UltraTech Cement exceeded profit estimates.

On the other hand, Reliance Industries, HCL Technologies, Maruti Suzuki, Bajaj Finserv, Tech Mahindra, Jio Financial Services and Eternal missed estimates.

Top upgrades and downgrades for FY27

The brokerage highlighted major upgrades and downgrades in FY27 earnings estimates.

Top upgrades included Kotak Mahindra Bank with a 20.9 per cent upgrade, UltraTech Cement at 8.8 per cent, Trent at 8.7 per cent, Wipro at 8.2 per cent and Bajaj Auto at 5 per cent.

Major downgrades included Adani Ports with a 7.5 per cent cut, Jio Financial Services at 6.6 per cent, Larsen & Toubro at 5.9 per cent, Coal India at 4.7 per cent and Maruti Suzuki at 4.5 per cent.

Brokerage positive on Indian equities

Motilal Oswal said Indian equities could benefit after a sharp underperformance in FY26 and continued foreign institutional investor outflows. However, it cautioned that markets may remain volatile due to developments linked to the West Asia crisis and rising commodity prices.

The brokerage said elevated commodity prices could affect India’s macroeconomic conditions and monetary policy outlook.

Top stock recommendations by Motilal Oswal

Motilal Oswal’s top Nifty-50 stock ideas include Bharti Airtel, State Bank of India, ICICI Bank, Mahindra & Mahindra, Titan Company, Bharat Electronics, Eternal, Tata Steel, Infosys and InterGlobe Aviation.

Its preferred non-Nifty ideas include TVS Motor Company, ICICI Prudential AMC, Indian Hotels Company, AU Small Finance Bank, Dixon Technologies, Waaree Energies, Coforge, Radico Khaitan and Delhivery.