Financial stocks to drive earnings growth of Nifty50 firms: Credit Suisse

Credit Suisse is more upbeat on domestic cyclicals than global, has an overweight on financials, industrials and cement; Some of its top picks are SBI, HDFC and Ultratech

The earnings of Nifty50 firms will grow 17 per cent annually between FY22 and FY24 and financial stocks will do most of the heavy lifting, Credit Suisse said on Thursday.

This is a sharp uptick considering Nifty earnings grew at a tepid pace of just 4 per cent annually between FY12 an FY19.

“FY12-19 saw a broad-based slowdown, with bank balance-sheet cleanup, a real-estate downturn, over-supply in global generics, and weak telecom margins, among others. Several of these trends are now reversing. The key to the earnings recovery remain financials, which are to contribute nearly half of Nifty EPS FY19-24