The life insurance sector is poised to deliver a strong performance in Q4FY25E, supported by a seasonal surge in new business volumes and steady growth in renewal premiums. However, margins are expected to remain broadly stable or may see slight compression due to product mix and pricing dynamics.
Auto industry sales in Q4FY25E exhibited a mixed trend. January recorded healthy traction, supported by beginning-of-year momentum and ongoing promotional schemes. However, demand gradually tapered in February and is expected to remain muted in March, with no major catalysts to drive retail acceleration.
In February 2025, the mutual fund industry's net AUM declined from INR 67.25 Tn to INR 64.53 Tn, despite reporting net inflows of INR 400.6 Bn during the month. The contraction was primarily due to valuation losses in equity-oriented funds, which offset the positive impact of inflows.
The demand environment in Q3FY25 reflected early signs of stabilization, with slightly improved Total Contract Value (TCV) momentum, supported by small and mid-sized deal conversions. However, large deal closures remained muted, indicating that enterprises continue to maintain a cautious stance, particularly for discretionary-led digital transformation initiatives.
Consumption trends in Q4FY25E remained mixed, with staple companies expected to report marginal volume growth. Inflationary pressures on discretionary spending weighed on major FMCG players such as HUL, Nestlé India, Britannia, and Tata Consumer Products.
As per AIOCD and AWACS data, in January 2025, the Indian pharmaceutical market (IPM) grew 8.7% YoY, led by price hikes (+5.3%) and new launches (+2.6%), but posted muted volume growth (+0.9%). In February 2025, the Indian pharmaceutical market (IPM) grew 7.5% YoY, driven by price hikes (+5.2%) and new launches (+2.7%), while volume declined marginally (-0.2%).
We anticipate industry credit growth to moderate to ~11.0% by end of FY25E, marking a sharp decline from 20.2% in FY24. This slowdown is largely attributed to a deceleration in unsecured loan expansion and persistent stress in the Microfinance (MFI) segment, which has prompted a more cautious lending approach across the sector.
Cement prices exhibited early signs of stabilization, following a subdued pricing environment through October and November 2024, driven by weak demand dynamics. However, a turnaround materialized in December, supported by rural housing expansion, and infrastructure-driven demand, leading to a moderate recovery in prices.
Varun Beverages Limited (VBL) delivered a robust performance in CY24, driven by organic volume expansion, an improved product mix, and contributions from recent acquisitions. Consolidated sales volume grew by 23.2% YoY, while net realization per case increased by 1.3% YoY, leading to a 24.7% YoY rise in revenue and a 25.3% YoY growth in PAT.
IndusInd Bank (IIB) disclosed a derivative accounting discrepancy, impacting 2.35% (~ INR 15.0-16.0 Bn) of its net worth as of December 31, 2024, arising from internal hedging trades linked to foreign currency borrowings and deposits.
Waaree Energies Ltd (WEL) is enhancing vertical integration by expanding into solar cell manufacturing, aiming for 11.4 GW capacity by FY27E. This includes a 5.4 GW facility at Chikhli by FY25E and a fully integrated 6.0 GW plant in Odisha, reducing dependence on third-party suppliers and securing a captive supply of cells for module production.
CreditAccess Grameen Limited (CREDAG), in its interim business update, reported a healthy recovery in its loan portfolio growth, with its Gross Loan Portfolio (GLP) increasing by 2.36%, reaching INR 253,950 Mn in February 2025, compared to INR 248,100 Mn in December 2024. The expansion was driven by borrower additions of over 0.15 Mn onboarded in January and February 2025.
In Q3FY25, companies within our pharma coverage revenue, EBITDA and Adj. PAT exceeded our expectations by 1.6%/3.7%/9.8%, respectively. The EBITDA margin and Adj. PAT margin outperformed our estimates by 53 bps and 133 bps, respectively.
India's passenger vehicle sales are projected to grow by 1.0-4.0% in FY26E, primarily driven by demand for SUVs and new electric vehicle launches. However, entry-level car sales are expected to remain sluggish due to affordability concerns.
In Q3FY25, we observed low teen YoY revenue growth and slight expansion in EBITDA margins for our coverage companies, but overall numbers were below our estimates across the board.
In Q3FY25, we observed low teen YoY revenue growth and slight expansion in EBITDA margins for our coverage companies, but overall numbers were below our estimates across the board.
