Two-wheelers lead recovery, broader uptick ahead
Aggarwal noted that two-wheelers have outperformed passenger vehicles in the current cycle. “PVs were already in the negative territory, whereas two-wheelers have actually done better,” he said. Ahead of Navratri, several auto companies offered dealer-level discounts, helping boost sales momentum as pent-up demand kicked in.
He added that while SUVs continue to perform strongly, smaller cars and sedans are also likely to see renewed traction. “Tractors are already doing well, and even commercial vehicles (CVs) can come back. It’s going to be a broad-based recovery across segments in the coming months,” Aggarwal said.
GST cuts could trigger strong consumption upside
Drawing parallels with the post-GST period in 2017, Aggarwal said that consumption-linked sectors could see a multi-quarter volume growth cycle once the impact of tax rationalisation fully plays out. “When GST rates were introduced and later cut, many companies across staples, apparel, and discretionary segments saw double-digit volume growth for three to four quarters in a row,” he explained.
Aggarwal believes that the current GST push, coupled with government reforms and improving liquidity, could create a similar setup for consumption growth over the next few quarters.
FMCG: Britannia, HUL, ITC stand out
In the FMCG sector, Aggarwal expects companies with strong distribution and marketing capabilities to lead the next growth wave. “If we look at the medium term, Britannia, HUL, and ITC stand out in the staple space,” he said, noting that these firms have a proven track record of execution and supply chain efficiency.While the near-term numbers may remain volatile across companies due to changing tax structures and festive timing, Aggarwal expects steady double-digit growth to return once demand normalises in early 2025.
Apparel and footwear: Value and mid-premium segments to benefit
In the apparel and footwear categories, Aggarwal expects value retailers and mid-premium brands to be the key beneficiaries of the ongoing consumer upgradation trend.
“Brands positioned between ₹1,000 and ₹2,500 price points could gain significantly,” he said. “Even if these companies take a slight hit on realisations, they will capture higher market share as consumers shift to better-quality, aspirational products.”
He highlighted Aditya Birla Lifestyle and Arvind Fashions as examples of companies positioned well to benefit from this trend. “The same is true for the footwear industry, where both value and mid-range brands are likely to see strong traction,” he added.
Jewellery: Strong value growth, but inventory risks remain
Aggarwal said that jewellery companies are likely to continue reporting robust value growth due to surging gold prices, even as volumes remain subdued. “Gold prices are up nearly 50–55% year-on-year, driving strong value growth across retailers,” he said.
However, he cautioned that high gold prices have led to inventory gains on the balance sheets of jewellery companies. “If gold prices correct or stabilise, those gains could reverse, which might impact profitability,” he warned.
Consumer durables: Mixed outlook across categories
Aggarwal said that the consumer durables space continues to present a mixed picture. While wires and cables are witnessing solid momentum driven by infrastructure and housing demand, the white goods segment — including fans, air conditioners, and appliances — has remained sluggish.
“The growth in white goods has not been very exciting so far,” he said, adding that the segment’s recovery would depend on sustained rural demand and easing input cost pressures.
Stock-picking key to outperformance
Aggarwal concluded that the next leg of the market rally will be stock- and sector-specific, rather than a broad-based one. “It’s going to be a very company-specific market now. Investors will have to be selective, focusing on companies with strong execution, supply chain, and pricing power,” he advised.
With government spending, lower GST rates, and improving consumer sentiment expected to lift demand across categories, Aggarwal remains cautiously optimistic on India’s consumption story in FY26.
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