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Charts & Analysis

Chart Of The Day: Nifty EPS Growth Plummets to 10%


The Nifty Earnings Per Share stands at Rs. 276.25, which translates to a dramatically low 10.23% growth in EPS since Nov 21 last year.


The Price to Earnings Ratio, or P/E has dipped to below 18 (it’s at 17.42 on Nov 21, 2011)

EPS growth has tanked in the September quarter, which is partly due to a great 2010 September. The EPS last year, same time, was Rs. 250.

While these are standalone earnings only, the consolidated earnings situation seems to be even worse this time. I will put that data in a separate post.

Also see Normalized EPS (that is, PE last year which is supposed to have predicted EPS growth this year)


The wider the gap, the greater the overvaluation last year. If you consider that the Nifty P/E is still 18 and we are likely to see an EPS contraction due to high inflation and a worldwide crisis, the Nifty remains overvalued today.


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