2026 Investment Outlook: Key Sectors for Growth and Long-Term Value
Varun Saboo, a prominent analyst at Anand Rathi Shares & Stock Brokers, is optimistic about the Indian markets heading into 2026. He sees significant potential in specific sectors that could offer promising returns to investors. According to Saboo, the banking and financial services (BFSI) sector, along with the consumer and fast-moving consumer goods (FMCG) sectors, are poised for growth.
When asked about the most attractive investment themes for the coming year, Saboo expressed strong confidence in the BFSI space. He stated, “We are very positive on the markets. Our previous predictions on Indian IT have proven accurate, and now we see great potential in banks and financial services. We are also very bullish on consumer discretionary goods and FMCG. The recent GST cuts have shown how growth is panning out, particularly in the auto sector, and we expect this to reflect in the consumer goods market as well. However, investors should focus on nascent categories with new-age portfolios and unpenetrated markets.”
Saboo specifically mentioned companies like Godrej Consumer and Marico as strong contenders in the FMCG sector. He believes these companies are well-positioned to capitalize on emerging consumer trends. Additionally, he highlighted Axis Bank and Kotak Mahindra Bank as key players in the financial sector, noting their robust performance and potential for further growth.
The conversation then shifted to consumer discretionary goods, especially white goods, which have been impacted by erratic weather patterns. Despite the near-term challenges, Saboo remains confident in the long-term prospects of these products. He explained, “All seasons have been quite severe, but we need to keep in mind that these are great long-term stories. Penetration levels for white goods in India are still quite low. Even though the stocks might face some short-term headwinds, they are excellent long-term plays. Summers could be harsher, and this period of lull is a good time to accumulate these names at a discount.”
Saboo also discussed the real estate sector, which he sees as highly attractive due to robust demand and a continuing upcycle. He noted, “Real estate typically has a seven to eight-year upcycle, and we have been in a good cycle for about three to four years. There is a significant lack of inventory, especially in the commercial space, which has led to a rally in commercial rates. Residential properties are also in high demand, and this is driven by the wealth creation happening in the country. All asset classes, including gold, silver, and equities, have been performing well, which further boosts real estate demand. We believe this sector remains attractive with a 12- to 24-month view.”
In summary, with banks, FMCG, consumer discretionary goods, and real estate emerging as key focus areas, Saboo’s outlook signals opportunities for investors seeking both growth and long-term value in the Indian market. His insights provide a valuable guide for those looking to navigate the investment landscape in 2026.
Anand Rathi Shares & Stock Brokers is a leading financial services firm in India, offering a wide range of services including equity and commodity broking, investment banking, and wealth management. The firm's expertise and insights are highly regarded in the financial community, making Saboo’s outlook a valuable resource for investors.
Investors looking to capitalize on these trends should consider the specific companies and sectors highlighted by Saboo, while also keeping an eye on macroeconomic factors and market conditions. By focusing on nascent categories and long-term growth opportunities, investors can position themselves for success in the coming years.
