Calling 2025 a “deworrification” phase — a period where past market worries finally fade — Chandan said investors could witness a rerating rally driven by consumption, metals, and real estate.
“Markets are like a coiled spring. The fears that were suppressing valuations are now easing one by one. Even if earnings don’t change much, valuations will rise sharply,” he said in an interview with ET Now.
From fear to rerating: The market setup looks strong
The last Samvat year, Chandan said, was about digesting shocks — geopolitical risks, policy uncertainty, and sluggish liquidity. Despite that, India’s corporate earnings held firm, with Nifty profits barely impacted by global events like the Trump tariffs.
“At worst, we saw Nifty earnings growth of 6.8%. That’s resilience,” he noted.
Going forward, Chandan expects Nifty earnings to rise to 9% this year and 12–13% next year, supported by fiscal measures like GST cuts, income-tax relief, and rate reductions.“India’s strength is its diverse earnings base. Even if one sector slows, others pick up — and that’s what sustains our valuation premium,” he said.
Consumption revival: The mega trend for the next decade
If one sector stands out for Samvat 2082, Chandan says it’s consumption — calling it a “5-to-10-year India story.”
“We’ve seen capex dominate for two years — now the spotlight is shifting to consumption,” he explained.
With urban demand rebounding, rural recovery holding steady, and the 8th Pay Commission likely to boost incomes, Chandan expects discretionary consumption to lead the next leg of growth.
He remains bullish on consumer discretionary, quick commerce, QSRs, travel, white goods, and digital consumption.
“These are branded, cash-generating businesses with steady growth and healthy dividend yields — they deserve higher valuations,” he added.
Unorganized to organized: The core profit pool shift
Chandan identified a powerful structural shift within the consumption story — the transition from unorganized to organized markets and the premiumization of consumer behavior.“Look at autos — the move from two-wheelers to SUVs is a perfect example. Similarly, in FMCG or QSRs, customers are moving toward branded, higher-quality products,” he said.
He added that investors should focus on companies enabling this upgrade cycle, such as those in home improvement, white goods, and financing-driven consumption.
Valuation comfort exists: If you look beyond the obvious
While many worry about high valuations in consumption, Chandan believes the real value lies in the ancillaries and midcap plays.
“Everyone’s talking about GST beneficiaries and autos. But if you unpack consumption as a theme — not a sector — you’ll find multiple opportunities,” he said.
NBFCs that finance consumer spending, insurance firms benefiting from rising vehicle sales, and new-age digital players are on his radar.
“These are long-term wealth creators, not just short-term performers,” Chandan emphasized.
Contrarian bets: Metals and real estate to shine
Interestingly, Chandan is turning contrarian on commodities and real estate, sectors that have been out of favor for years.
“We have a strong buy on metals and real estate. These are undervalued, trading near replacement costs, and balance sheets are clean,” he said.
He added that emerging market recovery, lower U.S. rates, and sustainable mining costs will support metal prices.
“Steel, copper, aluminum, zinc — they’re all turning the corner. These companies are leaner and profitable. Many are also dividend yield plays,” Chandan explained.
In real estate, he expects Diwali launches and home-improvement demand to lift the entire ecosystem — from cement and tiles to paints and wires.
“When real estate moves, it triggers a multiplier effect across the economy,” he noted.
Digital & tech: The men are separating from the boys
Chandan is also constructive on digital and tech-driven consumer businesses, which he says are now entering a profitability phase.
“After the hype and correction, strong business models are standing out. Quick commerce, fintech, and digital consumption platforms are now delivering real earnings,” he said.
As investors recognize scalability and sustainable margins, he expects rerating in select new-age stocks in 2025.
India’s strength is stability
Summing up his Samvat 2082 outlook, Chandan said:
“India is one of the few economies that can grow GDP at 6.5% and earnings at 10–12% steadily for years. Even without a valuation upgrade, that’s a recipe for compounding wealth.”
With consumption, real estate, and metals leading the charge — and digital companies finding profitability — he expects the market to deliver “a bright and truly fund-tastic Diwali.”
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