Q1 earnings begin on a strong note as banks fuel double-digit growth

Q1 FY26 earnings season has begun on a strong note, with a sample of 164 companies reporting 17.5 percent revenue growth year-on-year, the fastest in at least nine quarters, and net profit rising 14.5 percent for a second consecutive quarter of double-digit growth. Banks and finance companies drove the bulk of profit growth, accounting for 56.9 percent of the sample's net profit versus 51.3 percent a year ago, while excluding lenders net profit growth shrank to just 1.2 percent. Operating margins contracted to 20.9 percent from 26.9 percent due to higher input costs, and Reliance Industries' 22.4 percent profit decline to Rs 20,946 crore (due to a prior-year exceptional gain) weighed on the aggregate; excluding RIL, the sample's net profit surged 24.1 percent.