The Union Budget 2025 has placed a clear emphasis on boosting consumption rather than capital expenditure. The increase in the tax-free income slab to Rs 12 lakh is expected to enhance disposable income for the middle class, driving urban FMCG demand recovery amid the ongoing slowdown. With higher income levels and reduced income taxes, urban markets are poised to see stronger consumption growth compared to rural areas. While most consumer products will benefit, aspirational white goods—such as air conditioners and dishwashers—are likely to experience a surge in demand. Companies that depend on discretionary spending for non-essential but highly desirable goods stand to gain the most.
Post-budget bets: It’s all about the bling and style!
Motilal Oswal has identified Trent and Titan as key beneficiaries of the consumption-driven push.
Trent: Style, comfort & trendy gains
Trent has not had a fashionable start to 2025, with shares declining by 13 percent on a year-to-date basis. However, it delivered outstanding gains of over 100 percent in the previous year. The brokerage highlights Trent’s 2-3x growth compared to peers in the same segment, reinforcing its potential for continued outperformance. Motilal Oswal has set a price target of Rs 8,310, implying a substantial upside of 34 percent.
Titan to shine on consumption boost & jewellery tariff cut
Titan is another top pick, particularly benefiting from tariff duty reductions. The government has proposed lowering the basic customs duty on imported jewellery and parts made from precious metals from 25 percent to 20 percent, making these products more affordable. Motilal Oswal sees a 7 percent upside from current levels, while PL Capital and Antique Stock Broking have set higher targets of Rs 3,882 and Rs 4,598, respectively. Shares of Titan are down 7 percent from 52-week high and have given muted returns over the last 1 year. But so far in 2025, the stock has managed to give double-digit returns. What also works in favour of Titan is the rising demand for gold as well as rise in prices because of the geo-political risks, which will end up bolstering profit margins, and overall growth.
Durables get a Budget boost: Comfort just got more affordable!
The rise in disposable income is expected to boost demand for large consumer durable companies producing air conditioners, refrigerators, washing machines, televisions, and mobile phones. This could help revive demand for small appliances, which have been struggling amid a downturn.
Additionally, the increased allocation under the Production Linked Incentive (PLI) scheme for electronics manufacturing is expected to benefit both manufacturers and brands. ICICI Securities highlights that premium white goods such as air conditioners and dishwashers will see higher demand compared to basic appliances like fans and mixers. This trend is set to favour brands like Whirlpool, Voltas, and Blue Star.
Whirlpool, however, remains a tricky bet.
Whirlpool shares have come under intense selling pressure, plunging 33 percent in just five sessions on heavy volumes after news of 20% stake sale planned by the multinational parent. Mayuresh Joshi, Head of Equity Research at William O’Neil India, acknowledges that demand recovery may aid Whirlpool’s turnaround, but a significant promoter stake sale looms as a concern. "The intention to sell by the parent company signals a major supply overhang, which could cap any meaningful upside in the stock, particularly in volatile market conditions. While the budget’s consumption-driven measures may provide some relief, Whirlpool India's financial performance will need to show sustained improvement across key metrics to counterbalance the impact of the stake sale", says Joshi.
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