RIL, Infosys, Axis Bank, LTIMindtree & Havells: How these stocks are faring ahead of Q3 results

A number of largecap stock including Reliance Industries (RIL), Infosys, LTIMindtree, Axis Bank and Havells India are set to announce their results for the quarter and nine-months ended on December 31, 2024. Majority of these stocks were trading higher ahead of their Q3FY25 earnings.

Reliance Industries Ltd (RIL) and Infosys Ltd, both among the top-10 most valued companies in India opened higher on Thursday. RIL added more than a per cent to Rs 1,264.30, commanding a total market capitalization of more than Rs 17.1 lakh crore for the day. On the other hand, Infosys also added about a per cent to Rs 1,967.75 during the session, before falling in red at Rs 1,939.35 as of 12 noon.

Nuvama Institutional Equities estimate RIL's consolidated ebitda to report a sequential improvement mainly on account of earnings improvement in JIO and Retail segments. Ebitda is estimated to decline 1.5 per cent YoY due to weak performance from the O2C segment. We expect O2C Ebitda to grow 2 per cent QoQ due to recovery in refining margins, it said.

"We expect RIL's ONG EBITDA to decline 9 per cent YoY (flat QoQ) on 5 per cent YoY decline in production from KG-D6 block despite 2 per cent YoY increase in deep-water gas prices. Retail EBITDA is expected to report 1 per cent YoY and 4 per cent QoQ growth on higher footfalls, Jio's Ebitda is likely to surge 17 per cent YoY and 4 per cent QoQ on high ARPU," Nuvama.

B&K Securities expects Ebitda to increase by 5 per cent QoQ as gas-oil refining margins have increased by 5 per cent QoQ. Petrochem segment profitability continues to remain subdued due to weak demand coupled with supply glut. We expect 15 per cent YoY revenue growth in retail aided by festive and wedding season, while the telecom segment is expected to witness 2 per cent QoQ increase in Ebitda driven by increase in ARPU," it said.

Infosys is expected to post 0.7 per cent QoQ CC growth in Q3FY25, said HDFC Securities. Several deal wins in SAPS/4HANA by Infosys reflect continued growth momentum in the horizontal and margin guidance should remain unchanged for Infosys, it said with an 'add' rating on the stock with a target price of Rs 2,000.

Indsec Research expects cc QoQ growth of 0.2-0.8 per cent on account of higher revenues from sale of TP service delivery items; demand improvement in financial services; large deal ramp ups. This is expected to be offset by cross currency headwinds & furloughs. Ebit margins are set to improve marginally by 10 bps QoQ, it said.

Large deal TCV is expected to be around $3 billion. Guidance is expected to be raised in Q3 to 4.5-4.75 per cent. Client discretionary spend outlook, while reasons for wage hike deferral, banking sector demand will be looked at, Indsec added with a 'neutral' view on the stock.

India's third largest private lender, Axis Bank Ltd, jumped nearly 2 per cent to Rs 1,046.45 on Thursday, with its total market capitalization climbing to Rs 3.25 lakh crore for the day.

YES Securities is penciling sequential loan growth will be in the 3.5 per cent ballpark due to an idiosyncratic growth trajectory for Axis Bank, while NII growth will be in-line with average loan growth as the rise in yield on advances to be in tandem with rise in cost of deposits. Consequently, NIM will be stable sequentially. Sequential fee income growth will broadly match loan growth, it said.

"Opex growth would slightly lag business growth. Slippages would be marginally higher on a sequential basis. Provisions will be lower on sequential basis as the bank has made contingency provision in Q2FY25," said YES Securities with a 'buy' rating and a target price of Rs 1,475 on the stock.

"We are building loan growth of 11 per cent YoY and building in NIM to be stable QoQ, as we are past the re-pricing of funds. Fee income growth to be sluggish, reflecting weak loan growth," said Kotak Institutional Equities. We expect slippages of Rs 5,000 crore, mostly led by retail," it added citing slippages, deposit mobilization and NIM progression as key discussion areas.

LTIMindTree surged more than 3.35 per cent to Rs 6,033.60, with a total marketcap of more than Rs 3.8 lakh crore, while Havells India added 2 per cent to Rs 1,557.50, with a total valuations close to Rs 1 lakh crore, during the day.

Equirus Securities is modelling low-double digit revenue growth for core business which will be driven by C&W and ECD business. In C&W, wire growth will be impacted due to channel inventories destocking but considering recent capacity addition in cables, we expect strong growth to continue. In the ECD biz, while seasonal product categories such as fans and water heaters were unable to make the mark but during the festive season growth remained resilient, it said.

"In Lloyd, we see high-teens sort of a growth driven by both RAC and non-RAC categories. For Core biz, we expect margins to remain flattish YoY whereas for Lloyd we expect losses to reduce materially on the back of scale benefit, stable RM basket and recent price hikes," Equirus added. It has a 'long' rating on the stock with a target price of Rs 2,135 .

Nuvama sees a steady growth in durables, while wire growth is slightly weak. Lighting price correction may continue, though pace of decline has moderated. "A&P spend was preponed in Q2 and hence Q3 should see some moderation and hence should support margins in 3QFY25. Lloyd should see improved profitability YoY," it added.

Anand Rathi Shares & Stock Brokers is modeling a 1.8 per cent QoQ and 6.5 per cent YoY growth for LTIMindtree, while Ebitda margins may contract 90 bps to 16.5 per cent in the third quarter. It is expecting adjusted profit to fall 12.8 per cent sequentially to Rs 1,090.5 crore.

"Weighed down by seasonal furloughs but partially offset by the gradual recovery in US BFSI, we expect IT companies to report modest Q3 growth. Deal wins will continue to becost takeout-drive and hence, longer tenure," Anand Rathi added. LTIMindtree is among its top picks from the sector.

"We expect cc growth of 1.5 per cent QoQ. Growth will be broad-based except for the hi-tech vertical, where we expect a sharp revenue decline. EBIT margin will decline 180 bps qoq and 170 bps YoY. We attribute the QoQ decline to wage revision, increasing contribution to revenues from cost take out deals and pricing adjustments," said Kotak Institutional Equities.