“Earnings momentum has increased for Q2 2026. The BSE500 has reported 15.5% year-on-year earnings growth in Q2 2026, up from 11.1% in Q1 2026. Energy (41%), materials (40%) and consumer discretionary (20%) are the key drivers of this acceleration,” said Seshadri Sen of Emkay Global, which maintains its September 2026 policy. Handy goal of 28,000.
Profit explosion leaders
Leading the pack is Suprajit Engineering with an astronomical earnings growth of 10.492%, followed by Manali Petrochemicals with 8.975% and Westlife Foodworld with 7.662%, according to ACE Equity data.
Auto parts maker Suprajit benefited from strong OEM demand and aftermarket expansion, while Manali Petrochemicals continued the recovery of the petrochemical cycle.
GHV Infra Projects achieved profit growth of 3,880% thanks to a turnover increase of 17,402%, marking one of the sharpest turnarounds of this quarter.
The renewable energy sector emerged as the clear winner, with several companies posting triple-digit profit growth. Vikram Solar led with earnings growth of 1,646% as the solar equipment maker benefited from India’s aggressive expansion of renewable capacity.
Suzlon Energy, the wind turbine maker, reported 538% growth in earnings, with net profit rising to Rs 1,279 crore on revenue of Rs 3,866 crore. The company has successfully turned around after years of debt restructuring, benefiting from strong order inflows.Waaree Energies, another solar project, posted 134% profit growth, with profit after tax reaching Rs 878 crore on revenue growth of 70% to Rs 6,066 crore. The integrated solar panel manufacturer continues to expand capacity to meet rising demand.
HBL Engineering, a battery maker that benefited from the EV revolution, posted 410% growth in profits to Rs 387 crore, while revenue grew 135% to Rs 1,223 crore.
PSUs also showed strong operational improvements. Bharat Heavy Electricals (BHEL) reported 303% growth in profit to Rs 361 crore, while revenue rose 14% to Rs 7,512 crore. The investment company is benefiting from strong order execution in power equipment and railway electrification projects.
Hindustan Petroleum Corporation Ltd (HPCL) led the refining sector with 586% profit growth to Rs 3,667 crore, while BPCL posted 241% growth, both benefiting from improved refining margins and better product spreads.
The metal sector experienced a broad-based recovery. Tata Steel reported 299% earnings growth, with net profit reaching Rs 3,132 crore on revenues of Rs 58,216 crore, benefiting from stable realizations despite global headwinds.
JSW Steel posted 272% growth in earnings to Rs 1,734 crore, while smaller players such as APL Apollo Tubes (460% growth) and Sambhv Steel Tubes (469% growth) demonstrated the strength of the specialty steel segment.
Bharti Airtel, India’s telecom leader, posted 178% earnings growth, with net profit rising to Rs 8,570 crore on revenues of Rs 52,145 crore (up 26%). The company’s 5G rollout, ARPU improvement and subscriber growth drove stellar performance.
PB Fintech (Policybazaar) reported 161% growth in earnings to Rs 132 crore, demonstrating the insurtech platform’s path to profitability. Revenue rose 38% to Rs 1,614 crore, driven by strong policy spending and improved unit economics.
FSN E-Commerce Ventures (Nykaa) increased profits by 145% to Rs 33 crore on revenues of Rs 2,346 crore (up 25%). The beauty and fashion e-commerce platform showed improvement in profitability with better gross margins and cost optimization despite competitive pressure.
Laurus Labs emerged as a pharmaceutical star with 993% earnings growth and net profit of Rs 194 crore on revenues of Rs 1,653 crore (up 35%). The CDMO and API manufacturer benefited from strong demand for key molecules and improved capacity utilization.
Biocon reported 390% profit growth to Rs 133 crore, while Neuland Laboratories reported 195% growth, reflecting the sector’s recovery momentum.
Samhi Hotels reported an earnings growth of 627%, with net profit reaching Rs 102 crore on revenue of Rs 293 crore. The hotel operator’s portfolio of premium assets saw strong occupancy and rate growth, reflecting robust domestic tourism demand.
The cement sector witnessed broad-based earnings growth, with ACC (459% growth), Ambuja Cements (365% growth) and Shree Cement (304% growth) leading the way. Strong demand from the infrastructure and housing sectors, combined with stable input costs, supported margins.
Several companies that have doubled their profits have also achieved exceptional stock market returns over the past year. Elitecon International led with a return of 2,553%, followed by String Metaverse (1,152%), IFB Agro Industries (185%), ASM Technologies (182%) and Garuda Construction (170%).
Laurus Labs more than doubled investor wealth with a 102% return, while Force Motors rose 151%. Among largecaps, Bharti Airtel rose 33% and Tata Steel rose 24%.
Profit cycle bottoms out
“Earnings for Q2FY26 were broadly in line, with the intensity of earnings cuts easing. The earnings cycle is bottoming out, with growth expected to accelerate to double digits,” Motilal Oswal said, adding that valuations are reasonable with the Nifty trading at 21.4 times, close to the long-term average of 20.8 times.
HSBC’s Herald van der Linde echoed the optimism: “We think earnings in India have bottomed out and expect to see a broad-based recovery in 2026. Banks have been a huge drag on growth this year, but with deposit rollovers, margins will expand in the coming quarters. The technology sector is also likely to see increasing demand.”
Emkay Global’s Sen noted that the key driver is 160 basis points year-on-year margin improvement, but revenue growth is also contributing with an acceleration to 9.4% in Q2FY26 from 6.3% in Q1. “We believe the earnings cycle has bottomed out and expect significant acceleration from H2FY26 onwards. The GST cuts should lead to a sustainable recovery in demand and low WPI inflation should further help margins.”
However, the sustainability of these high growth rates remains a key question. While renewable energy companies have a multi-year view of growth, supported by government policy, cyclical sectors such as steel and cement could face headwinds as demand declines.
Earnings season underlines that India’s corporate sector continues to deliver surprises and rewards investors who are in the right sectors at the right time. As markets digest these results, the focus now shifts to management guidance for the second half of FY26 and how companies are dealing with global economic uncertainties.
(Credit: Ritesh Presswala)
(Disclaimer: Recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of the Economic Times)
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