India’s next big market play: Platforms and capex to outshine FMCG: Sandip Agarwal – News Air Insight

As India’s markets consolidate after months of underperformance, Sandip Agarwal, Fund Manager and Co-founder of Sowilo Investment Managers, believes the next big growth story will not be in traditional FMCG, but in platform-based businesses and capital expenditure (capex)-driven sectors.

In a conversation with ET Now, Agarwal highlighted that India’s slowing population growth is reshaping investment opportunities.

“For decades, FMCG stocks delivered consistent returns because population growth automatically drove volumes. But our population growth rate has declined from 1.5% to just 0.84% over the last two decades. Fertility rates are now below replacement level. That’s why we’ve moved away from FMCG,” he said.

Instead, Agarwal’s strategy is focused on platforms—financial intermediaries, logistics providers, and delivery companies—that can scale with India’s demographic advantage, similar to how Big Tech evolved in the U.S. over the last 30–40 years.

Earnings to mark a turning point

Despite global uncertainties and weak earnings in recent quarters, Agarwal is optimistic that the coming results season will mark a turnaround.

“We have massively underperformed most emerging markets in the last year. But this quarter will show bottoming out of earnings and much stronger commentary for the future. From here, we expect markets to recover steadily,” he noted.

He added that the Indian market has already gone through both time and absolute corrections, creating room for a constructive outlook.

Shipping industry back in focus

Commenting on the government’s push to strengthen India’s shipbuilding and shipping ecosystem, Agarwal called it a “superb initiative” that could unlock a multi-lakh crore opportunity.

The Shipping Corporation of India and other players have recently seen positive momentum in their stocks following the government’s announcements.

“The shipping industry was ignored because freight rates are volatile and vessels require heavy capex. But India pays around ₹6 lakh crore annually in freight. If invested domestically, this can become a massive industry and cut costs while creating opportunities for indigenous companies,” he said.

Key takeaways for investors

• FMCG may no longer deliver consistent long-term outperformance due to slowing population growth.
• Platforms and capex-driven businesses are seen as the next big wealth creators.
• Earnings recovery from this quarter onwards could drive fresh market momentum.
• Government initiatives in shipping and logistics could spark a new wave of growth in the sector.

With India eyeing a $10 trillion economy in the coming decade, Agarwal underlined that sectors aligned with structural growth and government priorities are best placed for investors looking to ride the next market upcycle.