The Nifty-500 companies delivered a strong performance in Q2FY26, posting double-digit earnings growth despite geopolitical challenges and continued weakness in consumption.
According to Motilal Oswal Financial Services, aggregate earnings of the Nifty-500 universe rose 15 per cent year-on-year, marking the best quarterly growth in the last five quarters.
Overall sales, EBITDA, and adjusted profit for the Nifty-500 stood at around Rs 35 trillion, Rs 8 trillion, and Rs 4 trillion, respectively—representing YoY growth of 8 per cent, 12 per cent, and 15 per cent.
Excluding financials, earnings rose 20 per cent YoY, while excluding metals, oil and gas, earnings increased 9 per cent.
Sector-Wise Earnings Drivers
The report highlights that earnings growth was broad-based, led by strong contributions from sectors such as Oil & Gas, NBFCs, Metals, Cement, Capital Goods, Telecom, Retail, and Real Estate. Oil Marketing Companies alone contributed 33 per cent of the incremental YoY profit growth.
Market Cap-Wise Performance
Midcaps and smallcaps once again outperformed large caps. Earnings of Midcap-150 companies grew 27 per cent, while Smallcap-250 companies posted an impressive 37 per cent growth. In contrast, large-cap earnings (Nifty-100) increased only 10 per cent, affected by the softer performance of private banks and the automobile sector.
Top Performing Sectors
Among the 20 major sectors, 17 reported profit growth in Q2. The strongest performers included Oil & Gas, Metals, Cement, and Capital Goods. The Oil & Gas sector saw EBITDA and PAT rise 48 per cent and 59 per cent, supported by OMCs. Metals reported an 18 per cent PAT increase on healthy ferrous and non-ferrous volumes. The Cement sector saw a sharp rebound, with earnings rising over three times compared to last year.
Moderate and Weak Sectors
Meanwhile, BFSI earnings grew 7 per cent YoY—driven by NBFCs, while banks delivered a muted performance. Several banks expect margins to improve in the second half due to CRR cuts and higher loan growth. The Telecom sector turned profitable, boosted by Bharti Airtel’s performance.
Some sectors reported softer trends. Technology earnings grew 8 per cent YoY, but companies indicated weak demand visibility. Consumer companies saw only 5 per cent growth as GST transition issues and the extended monsoon weighed on volumes. The Automobile sector reported a 16 per cent decline in earnings, mainly due to weak performance by Tata Motors PV.
H1FY26 Snapshot
For the first half of FY26, Nifty-500 earnings grew 12 per cent YoY, with midcaps and smallcaps continuing to lead. Large caps saw 9 per cent growth during the period, while midcaps and smallcaps grew 23 per cent and 19 per cent.
