Consumer stocks are top investment pick

The proposed reforms in goods and services tax (GST) announced by the government last week, coupled with the eighth pay commission dole-out, is likely to push consumption-driven stocks — such as air conditioners (ACs), select automobiles, fast-moving consumer goods (FMCG), retail, and counters of quick-service restaurants (QSRs) — into higher orbit over the next few months, believe analysts.

- PUNEET WADHWA

Against this backdrop, they suggest investors stay with the "consumption" theme rather than "capex-driven" plays over the next few months.

On the bourses, the consumption-driven theme has played out well so far in 2025-26 (FY26), with the Nifty India Consumption rising nearly 11 per cent, compared to around 5 per cent upswing in the Nifty50. Here are leading brokerages' investment strategies.

Bernstein

Equity markets will cheer this fiscal push, although a part of this flow will emerge from truncated capex. However, a recovery demand in the economy to eventually push private spending is the argument in the medium term. As for Nifty, we continue to expect a high single-digit return for the rest of the year. We retain our consumer over industrial focus this year.

We moved to overweight on consumer staples last month, upgraded durables earlier this year, and have been selectively picking other discretionary areas for our India portfolio (select retail, QSRs).

Jefferies