Analysts have started to trim fiscal 2026-27 (FY27) earnings growth forecasts for India Inc. amid firm crude oil prices that continue to rule above $100 a barrel (bbl).
The rise in crude oil and gas prices as a result of West Asia conflict, they said, are not fully priced in and are likely to dent the financial performance of India Inc. in the next couple of quarters. This in turn, they feel, will dent the overall FY27 numbers.
Before the conflict, Andrew Holland, head – new asset class, Nippon India Asset Management, for instance, expected around 10–12 per cent earnings growth, with potential upside into FY26–27.
The combined net profits (adjusted for exceptional gains & losses) of 141 companies that announced their results for the March 2026 quarter (Q4-FY26) till end of the last week were up 14 per cent year-on-year (Y-o-Y), growing at the fastest pace in the last 10 quarters, showed a Business Standard analysis. READ IT HERE
The companies’ net profits (adjusted for exceptional gains & losses) were up 1.7 per cent in Q4FY25 and increased 8.6 per cent Y-o-Y in Q3FY26.
Oil price forecast
Crude oil prices, meanwhile, continue to trade around $107/bbl, rising nearly 2 per cent on Monday amid stalled peace talks between the US and Iran. US President Donald Trump on Saturday cancelled a planned trip to Pakistan by his envoys, Steve Witkoff and Jared Kushner.
Those at JP Morgan, too, have flagged risks to corporate earnings growth in FY27 in the backdrop of the West Asia conflict, and expects supply disruptions and elevated costs to persist for a few months, despite the ceasefire with normalization of energy flows likely to take another three to four months.
“Challenges will manifest across sectors in various ways, including direct consumption impacts, margin compression, operational disruption and second-order effects. We cut our CY26/27 MSCI India earnings growth forecasts by 2 per cent / 1 per cent, to 11 per cent / 13 per cent,” wrote Rajiv Batra of JP Morgan in a recent note.
Besides crude oil and natural gas prices, another monitorable over the next few months, according to analysts is the rupee-dollar equation. India’s earnings are partly export-driven—sectors like pharma, information technology (IT), metals, and autos benefit from a weaker rupee.
“For overall FY27 we were looking at Nifty EPS (earnings per share) growth 15 per cent before the West Asia war started. My preliminary view is that it may come down to 7-8 per cent if the war continues and oil prices stay elevated for a few more months. The impact may be felt across automobiles, oil and gas, airlines sectors,” said Bino Pathiparampil, head of research at Elara Capital.
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