Rs 15 lakh crore in net profit! India Inc’s top 500 cos break records in FY25 despite downgrades

India’s top 500 companies have smashed past an all-time milestone, raking in over Rs 15 lakh crore in net profit in FY25, a historic high that underscores the resilience of corporate India, even as earnings faced widespread downgrades in the last 4 quarters.

Data compiled by Axis Securities shows that NSE 500’s cumulative profit jumped from Rs 10.66 lakh crore in FY23 to Rs 15.07 lakh crore in FY25, based on the last four quarters ending Q4FY25 on a rolling basis. This includes results from 458 companies. The new peak for corporate profitability in FY25 was powered by strong showings from agriculture & chemicals, telecom, and staples.

NSE500 profit surged 11.4% during the financial year. Telecom profits surged 45.7%, while staples, healthcare, and agriculture and chemicals posted solid 10.8–13.1% gains. Banks grew at a modest 4.8%, while oil & gas profits dropped 10.2%.

From FY21 to FY24, profit growth clocked a stellar 26% CAGR for NSE 500 companies. FY25 growth slowed to 10%, but excluding oil & gas, metals & mining, earnings rose 18.9%, Axis said.

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Even with this deceleration, the market’s profit engine hasn’t stalled. According to Axis Securities’ Head of Research Neeraj Chadawar, sectors that were deep in losses during the pandemic have now turned positive. He noted that financials, oil & gas, metals, and IT together contribute 65% of NSE 500 profits.

Chadawar said largecap companies are showing a recovery in earnings momentum, with 81% of Nifty companies beating or meeting earnings expectations in the March quarter.

Still, market optimism is being reined in. FY26 Nifty earnings have been downgraded by 3.3% and FY27 by 2%, Axis noted. The revision stems partly from index reshuffling — Zomato and Jio Financial have replaced BPCL and Britannia, altering index-level expectations. Adjusted for this change, the downgrade for FY26 is a more modest 2%.

Axis projects Nifty EPS at Rs 1,151 for FY26 and Rs 1,315 for FY27, and sees 14% CAGR earnings growth between FY23–27. But concerns persist. “Trade policy uncertainty, rupee depreciation, and relatively higher valuations remain key risks to near-term market multiples,” it added. Nonetheless, the firm has upgraded its base-case Nifty target for March 2026 to 26,300, valuing it at 20x FY27 earnings.

Motilal Oswal reported that FY25 Nifty EPS ended at ₹1,013, up just 1% YoY on a high base. FY26 EPS was cut by 1.9% to ₹1,135, with sharp revisions in SBI, ONGC, IndusInd Bank, Tata Motors, and TCS. FY27 was trimmed 1.1% to ₹1,314. “Forward earnings revisions are weakening, with downgrades outpacing upgrades,” the firm warned, despite a better-than-expected Q4FY25 print.

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Nomura also flagged that while aggregate FY25 profit growth came in at 8%, the outlook is softening. Consensus EPS forecasts for FY26/27 have already been revised down 2.3% and 1.4% since March. Since September 2024, that’s a 7.6% and 6.3% cut, respectively. The firm expects further 4–8% earnings downgrades for FY27, citing weak exports, reduced household financial savings, and a sluggish investment cycle.

IIFL noted that all sectors saw FY26 EPS downgrades except oil marketing companies, with the worst cuts in tech, construction, FMCG, and energy. Downgrade/upgrade ratios stood at a steep 3.5x, and RoEs compressed by 30 bps over the last six months.

Despite these cuts, analysts are optimistic about FY26. Sectors like defence, telecom, India-focused pharma, and hospitals are expected to sustain high visibility and strong growth. Cement and metals could also surprise positively due to input cost tailwinds.

The story is clear: corporate India just delivered its most profitable year ever, even amid macro headwinds and a downgrade-heavy season. While the forward path appears bumpier, the profit engine is still running strong — and FY26 is shaping up to be another test of resilience.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)

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