Despite biting inflation, analysts bullish on retail stocks for long haul

Analysts believe that the Indian retail sector is on the 'cusp of accelerated earnings growth' as consumer sentiment, and discretionary purchases bounce back from Covid-19 pandemic

Notwithstanding the inflation pinch, analysts believe the Indian retail sector is on the ‘cusp of accelerated earnings growth’ as consumer sentiment and discretionary purchases bounce back from the Covid-19 pandemic.

“The shift in consumer preference from the unorganised sector to the organised, coupled with uptick in domestic demand as people resume work from office, will cheer the Indian retail sector,” says Nishit Master, portfolio manager, Axis Securities.

Shopping malls are witnessing increased footfall in lower tier towns and standalone stores as consumption picks up and mobility improves.

Retailers, too, plan to ramp up store expansion in 2022-23 (FY23) as sales recover to pre-pandemic