Consumer discretionary stocks set to benefit from rising middle class income: Pankaj Tibrewal

He also added that with more disposable income in the hands of the middle class, the market could see a gradual but meaningful pivot from investment-led growth to a consumption-driven economic expansion

Consumer discretionary stocks are emerging as a compelling growth story in India, driven by rising incomes and evolving aspirations. As people move beyond necessities to embrace lifestyle upgrades, the demand for premium brands and experiences is surging.

Pankaj Tibrewal, Founder and Chief Investment Officer at Ikigai Asset Management sees this transformation unfolding over the next few years, unlocking massive opportunities in consumer discretionary stocks. "As per capita income rises, people move beyond roti, kapda, makan,” he says. "Better restaurants, fashionable clothing, and bigger homes become aspirational. That’s where we see a significant headroom for growth," the markets veteran added.

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This is a trend already mirrored in the stock market. Investors are gravitating towards companies catering to these evolving consumer preferences—whether it’s food delivery giants like Zomato or global brands, each representing a different slice of the consumption pie.

Another crucial factor in this equation is interest rates. "If rates are reduced over the next six months, there will be a significant boost on the EMI side," the market veteran added. The leverage of Indian households has surged in recent years. Five years ago, total consumer loans—including housing, jewelry, and credit card debt—stood at Rs 19 lakh crore. By the end of this year, that number is expected to hit Rs 42 lakh crore. However, incomes haven’t doubled in the same period, making any reduction in borrowing costs a catalyst for discretionary spending.

Given this backdrop, Tibrewal believes the real action lies in the second half of India—the vast middle-income segment. "There are a lot of good, interesting names available," he says, hinting at opportunities for investors looking to ride this wave.

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He also added that with more disposable income in the hands of the middle class, the market could see a gradual but meaningful pivot from investment-led growth to a consumption-driven economic expansion—a shift that investors will be watching closely.

The 30-share Sensex provisionally ended the day at 77,505.96, up 5.39 points. However, for the broader Nifty 50, it was the fourth successive year when it ended in the red on the day the Budget is presented. The Nifty 50 provisionally settled the day at 23,482.15, down 26.25 points.