The budget is out, and it’s clear that government is playing to the masses. More tax benefits, more subsidies, and more money in the hands of the middle class and lower-income groups.
What does that mean for the stock market?
Today’s market reaction gave us a preview:
- PSU stocks (defense, green energy, railway) dipped.
- Consumption, FMCG, and real estate stocks rallied.
This isn’t just a one-day trend, it’s a theme that could last months or even years.
Why Consumption Stocks Will Run
When people have more disposable income, they spend—it’s basic economics. Think about it:
- More money saved from tax cuts? → More dining out, ordering food, and shopping. (Zomato, Nestle, ITC, HUL win.)
- Extra cash flow? → More home upgrades—new ACs, refrigerators, TVs. (Voltas, Havells, Whirlpool benefit.)
- A stable economy? → More real estate demand. (DLF, Godrej Properties, Macrotech boom.)
The market is already reacting as Zomato surged 7% today, and FMCG stocks were up 3-4%.
Now, How to Play This Market?
The playbook is simple:
✅ Stay bullish on FMCG, consumption, and real estate.
✅ Look for companies that benefit from rising consumer spending.
✅ Avoid PSU-heavy themes unless there’s a policy push.
Modi government will most likely priorities keeping the masses happy in his third term.
Play accordingly.
And if you are a long term investor with a 5-10 years view-point, and you are a chad long term investor, you better keep investing in the companies with good fundamentals, irrespective of the sector.
As, in the end, India will do well anyhow in the long run.
We are survivors.
Vinay Mundhe 