Lipstick effect or pent-up demand? Consumption-driven stocks fly high

For the coming few months, analysts expect the Indian consumers to forego big ticket retail purchases and opt for reasonably priced indulgences

Despite the picture of an economic contraction painted by most forecasters, the India consumption story seems to be still going strong. The Nifty Consumption index, a gauge of consumption-driven stocks on the National Stock Exchange (NSE) has rallied 42 per cent since March 23 when the market hit their recent low as compared to 51 per cent rise in the Nifty 50. Though the margin of underperformance compared to the benchmark index may not be much, what is important to note is that all stocks that comprise the Nifty Consumption index have given a positive return since then.

Among the