CG Power, ABB India, Siemens and Larsen and Toubro (L&T) are expected to report better profit and loss performance and stronger growth rates over the coming quarters as they benefit from a favourable base and improving execution, Baid said.
She said the dip in Cummins India’s gross margin to 32.5%, driven by higher commodity costs, should be temporary with the company already implementing price hikes in its domestic power generation business. While margins should recoup to 34-35% levels over the next few quarters, she expects some downward revisions to earnings estimates for the current financial year 2026-27 (FY27).
The biggest monitorable for Cummins India will be its ability to sustain double-digit volume growth after the benefit of CPCB-IV pricing is now part of the base. She expects the stock to consolidate in the near term and relatively underperform some diversified industrial peers that are entering a stronger earnings cycle.
Baid said GE Vernova T&D’s earnings outlook remains intact despite softer order inflows during the quarter. She attributed the moderation in fresh orders to a temporary slowdown in domestic transmission equipment awards and noted that companies with sizeable export exposure have been better placed to offset the weakness.
GE Vernova’s order backlog provides visibility for the next two-and-a-half to three years, limiting the impact of near-term fluctuations in order inflows.
Commenting on the broader capital goods sector, Baid said companies are no longer delivering the sharp earnings and margin expansion seen during the earlier phase of the investment cycle. However, she believes improving order inflows indicate that growth could accelerate again next year.
She said current financial performance is likely to be close to the bottom of the cycle, with margins expected to recover over the next few quarters as execution improves.
Baid also remained positive on Netweb Technologies, citing continued investment in artificial intelligence (AI) infrastructure as a key growth driver. She said news flow around AI infrastructure spending would remain an important trigger for the stock outside of quarterly earnings. “We will see almost a 2x kind of revenue this year,” she said, adding that the “business is pretty solid in terms of the growth fundamentals.”
For the full interview, watch the accompanying video
Catch all the latest updates from the stock market here
