Sell

We believe that demand conditions in the Indian paint industry have likely bottomed out, and we expect a gradual recovery over the upcoming quarters.

remains in a bright spot with a steady recovery in Telco despite the negative seasonality in Comviva. Automotive within Manufacturing remains a Considering the Q1 weakness, the ask-rate for the rest of the year to achieve flat FY26 CC growth is ~0.8% CQGR, which we believe is a little challenging, given the underlying macro uncertainties. Although Communication has improved, it is difficult to draw a trend, given the conversion on deal TCV also tends to be slower than anticipated. However, we believe the cost optimization efforts would continue at a similar pace of FY25 with continued efforts to...

TechM’s 1Q operating performance was slightly below expectations. Revenue grew 1.0% QoQ to USD1.56bn (down 1.4% CC), marginally missing estimates.

TTAN saw growth moderation in Q1 with 17% growth in the jewelry business vs recent trends of ~25% growth. Also, LTL growth for TTAN in the early double digits is weaker vs 18-19% for peers.

We expect the demand environment is likely to remain weak in coming quarters while increasing competition intensity in the sector will impact the outlook. we further reduce FY26/FY27 earnings by 7/8%, respectively....

APNT aims for single digit value growth, with 18-20% EBITDA margins in FY26 APNT has given a cautious outlook for FY26 with single digit topline growth and EBIDTA margins in the band of 18-20%. Demand scenario has been tepid and organized decorative demand has seen a decline in FY25. Rural and tier3/4 demand is better than urban India, however normal monsoons benefit of tax cuts and benign inflation. The competitive intensity remains high in decorative paints; however current discounts and the pricing environment are...

Kotak Mahindra Bank (KMB) reported in-line healthy PAT at Rs35.5bn/2.2% RoA, aided by higher other income and partly offset by higher provisions – such provisions were for further shoring-up PCR closer to that of large peers at 78% and AIF provisions (Rs1bn).

TechM’s turnaround efforts are yielding results with its BFSI portfolio strengthening, large logo additions, a stronger deal TCV run-rate and improvement in margins. Strong new deal TCV growth of 42.6% YoY provides some comfort on FY26 growth outlook.

4QFY25 was peer beating. FY26 revenue guide assumes flattish CQGR at lower end; does not square up against the cautious commentary

HCLT’s FY26 revenue organic guidance of 1–4% YoY CC appears optimistic at its upper end, implying -0.6% to 0.9% organic CQGR. It is supported by an exit growth rate of 1.6%. Management mentioned that it did not see any project deferral or rampdown due to tariff-related uncertainties in Q4FY25.

M&M registered a strong Q3, on expected lines, with ~20%/21% revenue growth in the auto/farm segments, respectively. M&M logged auto volume growth of 16% YoY to 245K units, wherein it saw 20%/7% YoY growth in SUVs/LCVs to 142K/67.5K units, respectively.

While there will be a favourable base starting from Q4FY25, Asian Paints is likely to post muted growth rates in CY25 considering: (1) The stress in urban markets is likely to continue. It has also resulted in downtrading impacting the profit pool.

Sluggish Growth

4.25% CC YoY organic revenue growth maintained. Sectors beyond BFSI and Hi-Tech called out for pickup in discretionary spend

We attended M&M’s unveiling of its first two born EV SUVs—BE 6e and XEV 9e, and are impressed by the strong specifications/features and competitive pricing (introductory prices ~6% and 22%, respectively, below those of current top-selling models in the targeted ICE-SUV segments).

Kotak Mahindra Bank (KMB) continued to report margin contraction (11bps QoQ
to 4.9%) due to lower loan asset yields which was due to slower growth in unsecured loans.

HCLT has reported a beat vs our and consensus estimates on both revenue and margin fronts in Q2FY25. Discretionary spends picked up in BFSI and technology services.

TCS’s operating performance missed expectations in Q2. Revenue grew 2.2% QoQ (1.1% CC) to USD7.67bn, in line with expectation.

HCLT aims for consistent growth over medium term. Key growth drivers are: Data and AI, SAP cloud platform, ER&D, cloud migration and cybersecurity.