Heat wave, elections in India create unlikely earnings winners and losers

India’s Finance Minister Nirmala Sitharaman is widely expected to propose measures to boost consumption when she presents federal budget on July 23 giving further impetus to consumer-facing firms and retailers that have been hit by weak rural spending in the past few quarters.

Meanwhile, is projected to record its strongest growth for quarterly earnings since the end of 2022. Sales for June also surpassed expectations amid rising demand for . Earnings optimism pushed the firm’s Taipei-traded shares past NT$1,000 last week, briefly surpassing $1 trillion in market capitalization.

The AI boom should also fuel demand for services offered by exporters and Sector leader on Thursday reported profit that met analysts’ estimates, signaling corporations are gradually resuming spending on projects.

Highlights to look out for:

Saturday: Avenue Supermarts profit should be lifted by its continued expansion of store count and improving consumption appetite in India. First-quarter revenue was up 18%, the firm said in a pre-earnings update, and consensus projects 19% profit growth. Lower share of apparel sales continued to impact revenue per square foot of store area, analysts at Citi said.

Tuesday: Bajaj Auto may see the slowest profit expansion in five quarters as vehicle sales growth was muted by heat waves in several parts of India. According to the Federation of Automobile Dealers Associations, weather and elections led to lower footfalls at showrooms and delayed purchases. The company launched a new CNG-powered motorcycle earlier this month, which could help further boost its share in that product category, said Jefferies.

Wednesday: Asian Paints first-quarter net income should fall 9.2%, consensus estimates show. Revenue growth was muted due to price cuts and a weaker mix, said Jefferies. Gross margin gains are also expected to be partially offset by higher spending and negative operating leverage, according to Kotak Institutional Equities.

Thursday: TSMC second-quarter net income likely rose 29%, estimates show. Several brokerages including Morgan Stanley have raised price targets for the chipmaker as businesses race to secure hardware to build AI-supporting infrastructure. Key highlights for its upcoming earnings include how much TSMC can negotiate price increases after seeing strong product demand.

Infosys first-quarter net income will likely find support from higher revenues across segments, estimates show, even though financial industry revenue fell slightly. Emerging technologies make up more than 60% of its total sales, but the Indian IT company’s near-term growth is likely to remain pressured by weak enterprise IT spending, Bloomberg Intelligence said.
Friday: Wipro’s first-quarter revenue may be lower in constant currency terms, but its margins are expected to expand, as per estimates. Analysts at Nomura expect Ebit margins to expand on its continued cost control program and higher utilization at Capco. Recent strategic partnerships with other companies such as Siemens for automotive software should support the company’s earnings over the long term.

Friday: Wipro’s first-quarter revenue may be lower in constant currency terms, but its margins are expected to expand, as per estimates. Analysts at Nomura expect Ebit margins to expand on its continued cost control program and higher utilization at Capco. Recent strategic partnerships with other companies such as Siemens for automotive software should support the company’s earnings over the long term.