A 'nifty' little move: HDFC Life, SBI Life lead earnings upgrades

FY24 earnings growth to be led by BFSI, oil and gas, metal, and automotive

HDFC Life, SBI Life, and Tata Motors have seen the highest upward revisions in 2023–24 (FY24) earnings estimates among the National Stock Exchange Nifty components.

Meanwhile, Oil and Natural Gas Corporation, UPL (formerly United Phosphorus), and Grasim Industries have seen the maximum downward revision following disappointing 2022–23 (FY23) January–March quarter numbers.

By and large, the FY24 earnings per share (EPS) estimates for the Nifty index have seen a slight downward revision of 0.6 per cent. The Street now expects the Nifty EPS to grow 20 per cent to Rs 972 in FY24, from Rs 807 logged in FY23.

The 50-share benchmark index last closed at 18,534. This means the Nifty now trades at 19.1x its estimated earnings for the current financial year (FY24). “We forecast the FY24 earnings growth to be led by banking, financial services and insurance, oil and gas, metal, and automotive: these four sectors are likely to contribute 82 per cent of the incremental earnings to the Nifty," says a note by Motilal Oswal.

In FY23, SBI, Tata Motors, Bharat Petroleum Corporation, Reliance Industries, and Axis Bank accounted for 96 per cent of the year-on-year incremental growth in the Nifty EPS.