The first quarter of FY25 (April–June 2025) has witnessed a strong start in the Indian stock market, driven by robust domestic macroeconomic indicators, stable interest rates, and positive global cues. Several sectors, especially PSU banks, capital goods, auto, and FMCG, have shown impressive gains. On the flip side, IT and pharma sectors faced headwinds due to global uncertainty and margin pressures.
In this article, we highlight the best-performing stocks in Q1 FY25, breaking down the performance sector-wise. We’ll also cover expert analysis, valuation outlook, and the potential these stocks hold going forward.
📊 Nifty Performance Snapshot (April–June 2025)
| Index | Q1 FY25 Return (%) |
|---|---|
| Nifty 50 | +6.2% |
| Nifty Bank | +8.5% |
| Nifty PSU Bank | +12.3% |
| Nifty Midcap 100 | +9.1% |
| Nifty Smallcap 100 | +11.8% |
Source: NSE India
🏆 Top Performing Stocks – Sector-Wise Analysis
Let’s now dive into the top gainers by sector, based on price performance between April 1 and June 30, 2025.
🏦 1. Banking & Financial Services
Top Performers:
- State Bank of India (SBI) – +18.7%
- Bank of Baroda (BoB) – +22.1%
- Bajaj Finance – +12.5%
- Canara Bank – +24.3%
Reason for Rally:
- Strong credit growth (15%+ YOY)
- Reduction in NPAs
- Stable interest rate environment
Expert View:
PSU banks continued their re-rating story, benefiting from improved asset quality and aggressive digital push. Private lenders showed moderate growth.
🏭 2. Capital Goods & Infra
Top Performers:
- L&T (Larsen & Toubro) – +15.8%
- Siemens India – +18.4%
- ABB India – +20.9%
- BEL (Bharat Electronics) – +19.5%
Reason for Rally:
- Government capex boost
- Defence and automation contracts
- Order book growth
Expert View:
With infrastructure and defence spending rising in the budget, capital goods are benefiting. Analysts expect another strong quarter ahead.
🚗 3. Auto & EV Sector
Top Performers:
- Tata Motors – +21.4%
- Mahindra & Mahindra (M&M) – +17.6%
- Hero MotoCorp – +14.2%
- Bajaj Auto – +11.8%
Reason for Rally:
- Festive demand spillover
- Export growth in 2-wheelers
- EV launches from Tata and M&M
Expert View:
Auto stocks are firing on all cylinders. Volume growth and margin expansion are driving valuations higher. M&M and Tata Motors are top broker picks.
🧼 4. FMCG
Top Performers:
- Hindustan Unilever (HUL) – +8.4%
- ITC Ltd. – +12.2%
- Dabur – +10.1%
- Godrej Consumer – +11.7%
Reason for Rally:
- Rural recovery signs
- Cooling raw material inflation
- Dividend season
Expert View:
Defensive bets like FMCG regained steam after underperformance in late 2024. Consumption themes are likely to remain strong with good monsoon predictions.
💡 5. Power & Energy
Top Performers:
- NTPC – +16.7%
- Tata Power – +14.9%
- JSW Energy – +17.3%
- Adani Green Energy – +12.5%
Reason for Rally:
- Summer demand spike
- Renewable energy policies
- PLI schemes in green energy
Expert View:
Investors are rotating to energy stocks due to improving fundamentals, clean energy incentives, and long-term power demand growth.
❌ Underperforming Sectors – IT & Pharma
IT Sector:
- Infosys – -2.1%
- TCS – +1.4%
- HCL Tech – -0.6%
Reasons:
- Weak US tech demand
- Margin pressure
- Delayed deal cycles
Pharma Sector:
- Sun Pharma – -3.7%
- Dr. Reddy’s – +1.9%
- Cipla – -2.5%
Reasons:
- Regulatory issues
- US generics pricing pressure
- R&D spend affecting profits
Expert Note:
IT and Pharma are currently consolidation zones. Long-term investors may consider accumulating on dips, but short-term performance is likely to remain muted.
🧠 Brokerage Picks for Q2 FY25
🔍 Motilal Oswal’s Q2 Top Picks:
- SBI
- BEL
- M&M
- ITC
🔍 HDFC Securities’ Bullish Stocks:
- L&T
- Bajaj Finance
- NTPC
- Dabur
🔍 ICICI Direct’s Momentum Picks:
- Siemens
- Tata Power
- Canara Bank
- Godrej Consumer
📈 Valuation Outlook – Are These Stocks Still Worth Buying?
| Stock Name | Current PE | 5-Year Avg PE | Valuation Signal |
|---|---|---|---|
| SBI | 9.2x | 10.5x | Attractive |
| L&T | 23.1x | 24.7x | Near Fair |
| Tata Motors | 11.8x | 15.2x | Still Undervalued |
| NTPC | 10.5x | 12.8x | Room for Upside |
| ITC | 24.2x | 21.9x | Slightly Expensive |
Data source: NSE India, Moneycontrol, Brokerage Reports
Most of the outperforming stocks are still below their long-term average valuations or only moderately overvalued. Hence, selected picks may still offer value even after Q1 rallies.
📅 Upcoming Catalysts to Watch in Q2 FY25
- Q2 Result Season (July 2025) – Market will closely watch earnings to justify recent upmoves.
- Monsoon Data – FMCG and agri-dependent stocks could react.
- GST Collection Trends – A positive sign for consumption plays.
- Crude Oil & Inflation Numbers – May affect margins across auto, FMCG, and logistics.
- Global Rate Decisions – US Fed and ECB announcements can affect IT/Pharma sentiment.
✅ Conclusion
Q1 FY25 has been a rewarding quarter for investors, especially in sectors like PSU banks, auto, capital goods, and energy. With fundamentals improving and liquidity remaining strong, many of these top-performing stocks could continue their run in Q2—provided earnings deliver.
However, IT and pharma have lagged and may offer contrarian opportunities for long-term investors willing to ride out short-term weakness.
Investors should focus on:
- Quality companies with improving fundamentals
- Reasonable valuations
- Sector rotation trends and upcoming earnings
Portfolio rebalancing based on Q1 performance can be a wise move heading into the rest of FY25.
