Iran war halts but missiles would echo in Q4 results: 40 stocks may report over 20% profit dip

The Israel-US-Iran conflict that erupted in February 2026 has now found a temporary resolution, but its economic aftershocks are set to reverberate through India's corporate earnings for the quarter ended March 2026. Q4 results season began today with Tata Consultancy Services (TCS) announcing its numbers post-market hours.

The crude oil price spike flowed through various energy and crude-dependent sectors, causing a tangible impact on corporate earnings. Market watchers say that the trend of improving earnings estimates that had persisted for the past two quarters reversed in March 2026. For Nifty, Q4 earnings growth estimates vary between 4-6% YoY with Motilal Oswal saying sectors like automobiles, capital goods, logistics, technology, and utilities sectors have contributed to the majority of the reduction in FY26 earnings estimates.

Stocks facing 20%+ profit decline

Motilal Oswal data reveals that while some sectors like telecom (955% YoY), plastic pipes (62%), retail (47%), and NBFC-lending (30%) are set to deliver exceptional earnings growth, several sectors are staring at significant profit contractions at the company level.

The oil and gas sector has borne the brunt of the crude price spike and its downstream effects. Companies in this sector are directly exposed to volatile crude prices and refining margins.

Indraprastha Gas' profit is estimated to fall 45.1% YoY while Petronet LNG will see net profit of Rs 815.9 crore, down 23.8% YoY as LNG import costs have risen sharply with global gas prices. HPCL's profit is also seen as dropping 31%.

The auto sector has been hit by a combination of higher input costs, elevated steel prices, and weakening demand sentiment following the geopolitical shock. Hyundai Motor India is expected to report 26.7% YoY decline, the steepest profit contraction among major auto OEMs, reflecting margin pressure from higher component costs and competitive pricing.

Hindustan Aeronautics (HAL)'s profit is seen falling 32.9% YoY despite a strong order book as execution delays and higher input costs have compressed margins. Others include KEC International and Zen Technologies.

Others in the list include Birla Corporation, JK Lakshmi Cement, Alkyl Amines, Clean Science, Deepak Nitrite, Havells, Cyient DLM, Biocon, Blue Jet Healthcare, Cipla, Dr Reddy's Labs, Zydus, KNR, Zee, Hindalco, Jindal Steel, GAIL, Kolte Patil, Mahindra Lifespace, Signature Global, Sunteck, Sapphire, Tata Comm, ACME Solar, JSW Energy, Tata Power, Indiamart, IDFC First Bank, Niva Bupa.

Despite the headwinds, the overall earnings picture for 4QFY26 remains broadly healthy. The NBFC-lending sector is projected to be the standout performer with 30% YoY earnings growth, the highest in ten quarters.

The metals sector is also expected to report strong earnings growth of 27% YoY. Private banks are projected to grow 12% YoY, the highest in several quarters, while technology (+11% YoY) and consumer (+10% YoY) sectors are also expected to contribute healthy double-digit growth.

The report notes that the MOFSL large-cap, mid-cap, and small-cap PAT growth is projected at 7%, 25%, and 18% YoY respectively for 4QFY26.

Nuvama analysts say investors will soon need to brace for a potential demand downturn given the weak state of the global economy pre-war and also demand risks emanating from US private credit slowdown.

"Going ahead, while the top line could stabilise, the war-led supply disruptions are likely to weigh on elevated profit margins. This along with high global uncertainties warrants a cautious stance," the brokerage said.