Companies like Mankind Pharma, HCLTech, Zomato, etc are the top stock picks of 2025
The uncertainties surrounding global markets in 2024 did not hinder the Indian benchmark indices, BSE Sensex and NSE Nifty, from delivering promising returns. Over the YTD period, Sensex gained 9.6 percent, while Nifty increased by 8.4 percent. Analysts have predicted that several sectors will remain on the rise in 2025. The rise will be due to technological advancements, better government policies, and evolving consumer preferences.
Emerging Sectors to Watch in 2025
Let’s dive deep into the Indian market outlook for 2025, with details on the top stock picks of 2025, the sectors to invest in, details on government investment expected, and more:
1. BFSI
Banking and Financial Services are expected to continue increasing due to increasing credit demand and digital banking. Rising with an improvement of 20% CAGR at end-2030 due to a surge in better financial literacy as well as rising digital platforms.
Expected repo rate cuts by Q1 2025 would enhance bank profitability, therefore, a segment where investor interest might increase. Besides increasing retail participation, an increase in the usage of financial products can offer long-term growth opportunities
2. IT
Expectations from the Indian IT boom to remain strong, as this sector is also expected to benefit further from digitalization in various industries.
Technology spending in the US had been a tad subdued for the last two consecutive years. However, the need for cloud services, AI, and cybersecurity is now increasingly being addressed. Indian IT is expected to benefit further through this growing revival of investments in technology spending in the US. Thus, companies like HCLTech should do well.
3. Infrastructure and Capital Goods
Over ₹111 lakh crore investments in infrastructure projects will boost the growth in the infrastructure and capital goods sectors of the Indian Government.
Vast opportunities in highways, railways, urban development, and renewable energy projects will open avenues for construction, engineering, and other companies. Considering infrastructure to be an essential need for the government, it will naturally show stable growth till the end of 2025
4. Healthcare and Pharmaceuticals
There is rising demand for generics, biosimilars, and biotechnology solutions globally. Thus, the healthcare and pharmaceutical sectors are expected to continue an upward trend. Besides, the increasing prevalence of chronic diseases and the expansion of telemedicine services are also supporting the growth of this sector. Mankind is one of the top picks for 2025.
5. Renewable Energy and Sustainability
In this urgent and growing climate change context, renewable energy is booming as an investment destination. The focus of the Indian government on clean energy, such as solar, wind, and electric mobility, would ensure growth. This sector has been witnessing great growth in development and implementation.
6. Consumer Goods and Quick Commerce
Retail and consumer goods are rapidly changing spaces, especially with quick commerce, a fast-emerging market that has grown at a CAGR of 50%. Quick commerce platforms delivering groceries, electronics, etc. will see significant traction. This is because convenience has become the primary choice for consumers. The best bets in the consumer space are Zomato and Lemon Tree.
7. Cement and Construction
Increased government expenditure on infrastructure projects will boost demand in the cement sector. Orders will soar for cement manufacturing firms due to the related activity in construction across residential, commercial real estate, and government projects. Hence, cement will become a safe bet for investing the following year.
8. Power Sector
The power sector is expected to grow with higher capital expenditure in power generation, transmission, and distribution. The government’s emphasis on energy security and self-reliance in power production will spur investments. Increasing the share of renewable energy sources would keep the power sector at the heart of the country’s economic growth.
Geojit Financial Services views the power sector as attractive in light of the government’s continued emphasis on driving ‘Make in India’. Increasing capital expenditure in power generation, transmission, and distribution (T&D) is also expected.
9. Chemicals and Electronics Manufacturing
The chemicals and electronics manufacturing services (EMS) sector is best placed for growth in 2025 with the revival of the ‘China Plus One’ manufacturing strategy. This will continue to provide a competitive edge for Indian manufacturers in global supply chains. Top stock picks in 2025 in this space include Polycab, besides Macrotech Developers in real estate.
10. Consumer Staples and Pharmaceuticals:
Defensive sectors like pharmaceuticals and consumer staples can calm the uncertainty in the world economy. Given the solid demand for drugs and everyday products, attraction among investors for these industries cannot be denied.
Motilal Oswal’s Emerging Sectors to Watch in 2025
Motilal Oswal is overweight in IT, health care, BFSI, consumer discretionary, industrials, and real estate. The analysts have shown the same outlook for other emerging sectors like capital markets, electronics manufacturing services (EMS), digital e-commerce, and hotels for the year 2025.
According to the projections, the segments mentioned above are strategically well-positioned to benefit from long-term themes and government initiatives. The key stocks of Motilal Oswal are ICICI Bank, HCLTech, L&T, Zomato, NAM India, Mankind, Lemon Tree, Polycab, Microtech Developers, and Syrma SGS.
Conclusion
As the market navigates global macroeconomic challenges, sectors with strong fundamentals and long-term growth prospects will continue to drive returns in 2025. By staying informed about these emerging opportunities, investors can make strategic decisions. Thus, they are diversifying their portfolio to be in line with India’s growth trajectory in the coming years.
