Mukherjea told ET Now that October was “spectacular” for consumer-facing sectors, with autos, FMCG and durables showing clear improvement, while November remained steady. He expects Nifty earnings for Q3 to approach 10% growth, a big jump from the 1% seen in the September quarter.
Middle class needs urgent relief: More rate cuts + direct tax cuts
Mukherjea welcomed RBI’s signal of further rate cuts but argued that the middle class is still under intense pressure due to:
- High debt levels
- A tight job market
- Slow consumption growth
He believes India needs another 100 bps in rate cuts along with fresh direct tax relief in the upcoming budget.
He suggests the government should throttle back ₹2 trillion in capex to fund a higher zero-tax income limit—lifting the current ₹12 lakh threshold to ₹15 lakh.
“Consumption is 60% of GDP. The 40 million taxpayers are the engine of this economy. Giving them relief is essential,” he said.
Capex slowdown may be necessary
With government capex already hitting the ₹10 trillion operational ceiling, Mukherjea says India must temporarily ease capex to stimulate consumption.
“It’s a clear trade-off. We simply don’t have the capacity for capex beyond ₹10 trillion,” he noted.
Trent still a strong long-term bet despite valuation worries
Mukherjea remains bullish on Trent, one of Marcellus’ portfolio favourites, even after the stock fell 40–45% from peak levels.
Why? It is because Trent has delivered stronger same-store sales growth than rivals and continues rapid store expansion. It also appears reasonably valued after adjusting for expansion-led earnings distortion
“If the government continues its supportive moves, Trent will be a key beneficiary,” he said.
Broader earnings set to improve if consumption holds up
Beyond Nifty companies, Mukherjea sees encouraging signs across the broader market:
- BSE 500 / NSE 500 earnings were already up ~10% in September quarter
- Consumption-sensitive sectors will likely lift the entire earnings landscape
He expects a broad-based recovery in 2026 if policy support continues.