FY18 results must catch up to justify high valuation of Indian equities

For now, Q1 expectations are watered-down, particularly for consumer-oriented sectors

Starting this week, India Inc would gear up for its busy earnings period yet again. The key question is if corporate India will match investors'expectations. Thanks to the passage of goods and services tax (GST) on July 1, the expectations are extremely toned down this June quarter (Q1). Analysts at Edelweiss expect a moderate 12 per cent revenue growth for 225 companies under its coverage, while net profit growth may dip by even two per cent on the back of a 262-basis point decline in operating margins.

However, it is essential that at least these lowered targets are met to