Nifty50 Earnings Downgraded Despite Positive Index Returns

Even though the stock market indices have given positive returns over the past year, the earnings outlook for Nifty50 companies is weakening. Profits are not growing as expected, and only a few large companies are responsible for almost two-thirds of the overall gains in the index.

Several brokerage firms have said that earnings per share (EPS) estimates for financial years 2026 and 2027 have been cut for many companies. This means analysts now expect lower profits than earlier forecasts. These downgrades are happening across different sectors, showing that the slowdown is not limited to just one industry.

Because of this, experts are worried about whether companies can maintain strong earnings growth in the coming years. They are also questioning how resilient different sectors are and whether current stock market valuations are justified. If earnings do not improve, the market may face pressure despite recent gains.