Consumption Story 2025: 5 Undervalued Consumption Stocks Set for a Rebound
India's consumption sector is at a promising inflection point in 2025. After a subdued period marked by global headwinds, inflation, uneven growth, and volatile demand, assertive government measures, fiscal support, GST reforms, and the prospect of rising household incomes are setting the stage for robust recovery. As festive season and the Eighth Pay Commission approach, the sentiment among investors is shifting, especially towards undervalued consumption stocks trading at attractive valuations.
Here’s an in-depth look at 5 hidden gem stocks from consumer durables, FMCG, lifestyle, and electronics that are sparking renewed interest in the mid-2020s.
1. Symphony Ltd.
Business Overview
Symphony is the world’s largest air cooler manufacturer, operating in over 60 countries. Its product portfolio spans residential, commercial, and industrial cooling solutions.
Why It’s Undervalued
Trades at a P/E of 40, below the 3-year median of 47.
Revenue fell 39% YoY (₹3.7 bn), impacted by a shortened summer and rains, yet it recorded the second-highest-ever quarterly revenue.
Operational margins dropped to 10.3%, with PAT down 46% YoY (₹690 mn).
Growth Drivers
Diversification beyond traditional coolers to all-season and counter-seasonal products (fans, water heaters).
Strategic push in semi-urban and rural markets, leveraging alternative retail and digital channels.
Growing export-led model toward high-growth geographies.
Outlook
Symphony is actively pivoting to new segments and distribution channels. As weather effects normalize and consumer demand revives, margins and top-line growth should recover.
2. Whirlpool of India
Business Overview
Whirlpool is the leading manufacturer/marketer of home appliances, including refrigerators, washing machines, air conditioners, and kitchen appliances.
Why It’s Undervalued
Trades at P/E of 46, well below its 3-year median of 92.
Revenue declined 2.4% YoY, PAT increased marginally due to cost optimization.
Growth Drivers
Market share gains in refrigerators, washing machines, and premium segment.
Reinforced R&D efforts for sustainable products.
Increased launches in tier 2/3 cities targeting new demand pockets.
Outlook
Whirlpool is rebounding with a premium product mix and improved operational metrics. Despite promoter stake reduction (from 75% to 51%), the company is winning back investor confidence with sustainable growth.
3. Campus Activewear
Business Overview
India's leading sports and athleisure footwear brand with ~17% branded market share.
Why It’s Undervalued
Trades at 69x earnings, below the 3-year median of 90.
Revenue rose by 1.2% YoY, driven by premium sneaker ASP, while PAT fell 12.6% due to indirect expenses.
Growth Drivers
Fastest lead times in the footwear industry; new styles launched in 60–90 days.
Strong expansion across retail and online; targeting women’s and kids’ segments.
Focus on high-margin sneakers above ₹1,499 and expanding portfolio above ₹2,000.
Outlook
Campus is well-poised for double-digit growth, recovery in volumes, and improving margins as consumer spending strengthens across regions and channels.
4. Elin Electronics
Business Overview
Elin is a top electronic manufacturing services company, serving leading brands with end-to-end solutions in lighting, fans, and appliances.
Why It’s Undervalued
Trades at 27x earnings, below the 3-year median of 45.
Operating revenue up 1% YoY (₹2.9 bn); PAT soared 59% YoY to ₹59 mn as margins expanded.
Growth Drivers
Addition of new products (TPW fans, OFR, OTG) and new clients (Wipro, Usha).
Investment of ₹1.2 bn in capacity expansion to handle rising demand.
Strong OEM relationships, including Philips, Bajaj, Bosch, and Havells.
Outlook
Elin expects 15–18% top-line growth in FY26. It benefits from India’s manufacturing push, strategic partnerships, and high-value product launches.
5. Dabur
Business Overview
Dabur is a leading FMCG company, with products spanning health supplements, personal care, beverages, and foods—reaching 80% of Indian households.
Why It’s Undervalued
Trades at a P/E of 52, slightly below its 3-year median of 54.
Revenue growth of 1.7% and volume growth of 3.5%. PAT up 2.8% to ₹5.1 bn, beating estimates.
Growth Drivers
Strong rural demand, with urban sales showing sequential recovery.
Market share gains in oral care, home care, and skin care.
Vision FY28 strategy emphasizing premiumization, innovation, and digital expansion.
Outlook
Dabur is leveraging its wide distribution network and innovative portfolio for high single-digit growth, both domestically and in new international markets.
Key Themes for Consumption Rebound
Policy Tailwinds: Tax and GST reforms alongside the Eighth Pay Commission will boost disposable incomes.
Premiumisation: A shift to higher-value, innovative products in both FMCG and durables.
Digital Penetration: E-commerce and omnichannel strategies are driving reach and efficiencies.
Rural Expansion: Companies expanding to Tier 2/3 cities and rural markets for the next growth wave.
Investment Checklist for Consumption Stocks
Look for stable margins, improving operational metrics, and persistent brand strength.
Evaluate management track record and corporate governance.
Track sector and company-specific news for timely entry/exit signals.
Diversify across various consumption sub-sectors for risk mitigation.
Conclusion
India’s consumption revival is picking up steam. Stocks like Symphony, Whirlpool, Campus Activewear, Elin Electronics, and Dabur offer investors attractive entry points—trading below historic valuations but backed by strong fundamentals and enduring sector demand.
For long-term investors, these five are well-positioned to ride the next phase of India’s consumption growth story in 2025 and beyond.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Please conduct your own research and consult a financial advisor before making investment decisions.
