D-Street shrugs off slowdown fears as consumption stocks zoom up to 780% in a year

New Delhi: Despite rising concerns over a global economic slowdown, consumption and discretionary expenditure themes are consistently playing out well on Dalal Street.

Most analysts tracking Indian stocks continue to believe in the fundamentals of India's growth story.

Even though Sensex returns were flat over the last one year, consumption stocks have rallied up to 780 per cent. On a YTD basis too, these stocks are up 530 per cent outperforming the BSE's barometer, which trades with marginal gains.

Shares of Quantum Digital Vision (India) have gained up to 780 per cent the last one year, whereas Imagicaaworld Entertainment is up by 360 per cent.

Interworld Digital and JMD Ventures have gained about 280 per cent in the last 12 months. Nicco Parks & Resorts, VR Films & Studios and Unistar Multimedia have also advanced 100-140 per cent during the same period.

Other companies including Wonderla Holidays, Eros International Media and BAG Films and Media have risen more than 90 per cent in the last one year.

Panorama Studios International, Inox Leisure, SAB Television Network, Tips Industries, Universal Arts, UFO Moviez India and PVR have gained between 25-57 per cent during the same period.



However, analysts on Dalal Street believe that India is nowhere close to an economic slowdown, and are convinced even on the high ticket consumption ahead of the much awaited festive season.

Amusement parks, theme parks and other such recreational spots are gaining footfall simply because they have opened up after a long life threatening pandemic and have a unique experience, excitement or an adrenaline rush for the user.

Amit Khurana, Head of Research, Dolat Capital said that calling this 'Lipstick Effect' in the economy is completely irrelevant as the expensive discretionary space is doing well. "Covid-19 has changed the way of life and consumption," he said.

With time and new prodigy of consumers, leisure consumption trends have changed, he added. "Diversity and popularity of the consumption avenues including road trips or staycations''

Khurana said that there is much demand from the consumers which is pushing the prices higher. He remains bullish on India's consumption stories across all the segments.

Echoing the similar tone, G Chokkalingam, Founder and Chief Investment Officer, Equinomics Research, believes there is no lipstick effect playing out in the economy considering the overall rise in the consumption and recreational activities.

"These sectors are gaining momentum amid the structural changes as the worst of Covid-19 pandemic is behind us," he added. "The growth remains strong for India, signalling that there are no signs of economic weakness which may dent the sentiments."


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