$40 Billion Fund Signals End to Year-Long Earnings Downgrades for Indian Firms

A major global investment fund, overseeing roughly $40 billion, believes the prolonged streak of earnings cuts for Indian companies is finally coming to an end. Analysts covering the Indian market had spent much of the past year reducing profit forecasts amid a weak domestic economy and export headwinds.

The turnaround thesis rests on emerging strength in several sectors. For banks, an anticipated rise in loan growth and potential tax reliefs are cited as key triggers. For consumer and automobile players, an uptick in demand and easing input pressures are increasingly visible. The fund’s internal modelling suggests that downward revisions may stabilise, paving the way for upside upgrades.

Despite the optimism, the fund cautions that valuations have already priced in much of the earnings recovery, so incremental upside will depend on actual execution and sustained macro improvement. For investors, the message is clear: the tide may be turning, but vigilance remains essential.