Betting on 5 stocks as metals shine; GST boost to discretionary spending: Nandish Shah
Motilal Oswal’s Nandish Shah bets on NMDC, JSW Steel, Tata Steel, Vedanta, and Hindalco as metals rally. GST cuts and easing inflation are expected to revive discretionary demand, boosting consumption-focused sectors.
By Nandini Sanyal, ETMarkets.com |
Agencies
The metal sector is back in the spotlight with strong prospects across both ferrous and non-ferrous categories, according to Nandish Shah, AVP at Motilal Oswal Financial Services (MOFSL). Speaking to ET Now, Shah said the outlook for metals remains positive, with top picks including NMDC, JSW Steel, and Tata Steel in the steel segment, and Vedanta and Hindalco among non-ferrous players.
“The momentum in metals looks strong, both on the ferrous and non-ferrous side. We see NMDC, JSW Steel, and Tata Steel as well-placed in the current environment, while Vedanta and Hindalco remain attractive bets on the non-ferrous front,” Shah said.
On the consumption side, Shah expects the recent GST rationalization to act as a strong catalyst for demand recovery, especially in the consumer discretionary space.
“Over the past 9–12 months, there has been very little pickup in consumer staples. Now, with inflation coming down and GST rates being cut, discretionary consumption is likely to improve,” he noted.
This view aligns with the broader market expectation that lower taxes and easing inflationary pressures will support household spending, particularly in categories like appliances, premium goods, and lifestyle products. While staples may not see a significant surge, discretionary items are likely to benefit more directly from lower tax incidence.
Market implications
The twin themes of strength in metals and a boost in consumer discretionary demand highlight two key areas investors are watching closely. For metals, a combination of global demand recovery, stable commodity prices, and improved margins is creating a favorable setup. For consumption, the government’s reform measures—alongside easing inflation—are expected to aid volume growth for FMCG and discretionary companies in the months ahead.
“The momentum in metals looks strong, both on the ferrous and non-ferrous side. We see NMDC, JSW Steel, and Tata Steel as well-placed in the current environment, while Vedanta and Hindalco remain attractive bets on the non-ferrous front,” Shah said.
GST cuts to drive discretionary spending
On the consumption side, Shah expects the recent GST rationalization to act as a strong catalyst for demand recovery, especially in the consumer discretionary space.“Over the past 9–12 months, there has been very little pickup in consumer staples. Now, with inflation coming down and GST rates being cut, discretionary consumption is likely to improve,” he noted.
This view aligns with the broader market expectation that lower taxes and easing inflationary pressures will support household spending, particularly in categories like appliances, premium goods, and lifestyle products. While staples may not see a significant surge, discretionary items are likely to benefit more directly from lower tax incidence.
Market implications
The twin themes of strength in metals and a boost in consumer discretionary demand highlight two key areas investors are watching closely. For metals, a combination of global demand recovery, stable commodity prices, and improved margins is creating a favorable setup. For consumption, the government’s reform measures—alongside easing inflation—are expected to aid volume growth for FMCG and discretionary companies in the months ahead.ADVERTISEMENT
Overall, MOFSL’s strategy underscores confidence in cyclical recovery themes. With metals gaining traction and consumption set for a revival, the brokerage believes these segments could lead the next leg of market performance.Too busy to trade in stocks? Invest in Mutual Funds with ET Money!
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