India’s corporate earnings showed strong growth in the third quarter of FY26. A sample of 3,723 companies reported revenue up 9.8% and net profit rising 13.5%. This was better than the 8.1% revenue and 14.5% profit growth seen in the second quarter ended September 2025. Gautam Duggad, institutional research head at Motilal Oswal Financial Services, said, "Earnings growth for the companies under coverage at 16% year-on-year was in line with our estimates, largely driven by metals, oil and gas, and banking and finance sectors." Nifty 50 companies reported 7% profit growth. Tata Motors Passenger Vehicles (PV) showed unusually high profits due to a one-time Rs 82,616 crore gain from the demerger of its commercial vehicles business. This skewed the sample's profit data. Excluding Tata Motors PV, net profit growth was 11.1% in Q3 and 33.7% in Q2. Feroze Azeez, joint CEO at Anand Rathi Wealth, noted that smaller and mid-sized companies showed stronger earnings growth than Nifty 50 firms. "This suggests earnings traction is shifting toward mid- and small-cap companies, supported by sectoral rotation and operating leverage," he said. Operating margins slightly fell by 60 basis points to 17.8%. Excluding banks, the margin stayed flat at 15.4%. The banking sector faced pressure on net interest margins. Sector-wise, energy benefited from stable, low crude oil prices. Financials grew due to better loan growth and stable asset quality. However, communication services and consumer discretionary sectors lagged because of one-time costs related to new labour codes. Looking ahead, analysts are optimistic. Duggad said, "The resolution of the India-US trade deal removes a significant overhang and positions India among the most competitive exporters relative to key emerging market peers." Antu Eapen Thomas, research analyst at Geojit Investments, added that GST rationalisation in late 2025 boosted disposable income, lifting consumption. He projects Nifty 50 earnings growth at 5-6% for FY26, rising to 12-15% in FY27. Azeez expects a recovery in FY27, with opportunities in capital expenditure and infrastructure, backed by government spending and revived private investment. India’s corporate profits look set to keep shining, lighting up the country’s economic skyline for years to come.