Mid-, small-cap indices beat Nifty50 despite poorer earnings show

Market players say while the earnings report card of the broader universe for the last quarter was disappointing, investors are trying to factor in a revival in earnings.

The mid- and small-cap indices are racing ahead of the benchmarks this year. However, their earnings scorecard for the December quarter has been much worse than the Nifty’s. According to an analysis by ICICI Securities, nearly half the Nifty50 companies’ net profit has exceeded consensus estimates. On the other hand, only about a third of the companies in the mid-cap and small-cap universe have managed to beat expectations. This is despite the cut in corporation tax rate by the government and softness in raw material prices during the quarter. Most companies, irrespective of which universe they belong to, have missed