October 8, 2025

Get ready for a thrilling turnaround in India's corporate world! Market expert Sunil Subramaniam told ET Now that India's corporate earnings revival will begin in January 2026. After months of quiet performance across big sectors, the second half of FY26 promises to be a blockbuster. Right now, he says, the markets are chilling in a “wait-and-watch phase” after last year’s fast rally. But don't be fooled; the strong foundation for an earnings boom is quietly taking shape. Why the delay? "The GST announcement caused a temporary postponement of purchases this quarter," explains Subramaniam. Add to that a global slowdown, especially hitting IT and services, and the time government spending takes to actually work its magic. All these mean the real bounce-back will only show up by the January quarter. Hold your excitement for now because the festive shopping season is next on the agenda! This celebration of sales is likely to pump up consumer sector numbers, showing its fire in Q3 FY26 results. “The second half will be much better than the first half,” he promises. IT Sector in the Spotlight: Overdone Correction and Smart AI Moves The market is watching IT giants like TCS and Infosys closely as the new earnings season begins. Subramaniam calls the recent dip in IT stocks an “overdone” correction, especially after worries about the H-1B visa cap in the US. Don’t panic though — last year, India’s top five IT firms got just 13,000 H-1B visas, and their business models now favour onshore and nearshore work. So, the fear is bigger than the threat. TCS’s updates on big deal progress, especially in the US, will set the tone for IT stocks. Plus, a weaker rupee means IT exporters could get a nice boost. "In rupee terms, earnings should benefit from depreciation, though constant currency growth will be a key metric to track," he adds. AI Layoffs? Not a Warning—But a Wise Move! Worried about layoffs linked to AI? Subramaniam has a refreshing take: these cuts actually show smart preparation! "Any job rationalization linked to AI adoption is actually a positive sign. It means companies are preparing their workforce for the next phase of technology. It’s smart thinking — not weakness," he states boldly. Big players like TCS and Infosys will likely boost AI hiring from colleges and may even snap up AI-focused companies to stay ahead. Eyes on 2026: Earnings-Led Rally Incoming Despite some bumps now, Subramaniam stays upbeat on India’s longer-term stock market future. September-quarter results might stay low, but the earnings cycle is near its lowest point. "Once earnings pick up and consumption demand rebounds, markets will start reflecting those fundamentals well before Q3 numbers come in," he predicts. For investors, his advice is clear: be smart and steady. Use any short-term price dips in solid companies to build your investments before the expected 2026 earnings boom rolls in. Get ready—the big ride is coming!

Read More at Economictimes →

Tags: India corporate earnings, Sunil subramaniam, It sector, Ai layoffs, Market outlook, Earnings recovery,