Sanjay Chawla Favors Consumer Discretionary, Healthcare; Q3 FY26 Earnings to Surge

• Sanjay Chawla, CIO - Equity at Baroda BNP Paribas Mutual Fund, favors consumer discretionary and healthcare sectors for 2026.
• Consumer discretionary is boosted by GST rationalization, falling interest rates, and local manufacturing thrust.
• Earnings growth is projected to improve significantly from Q1 FY26 due to favorable base effects, interest cost savings, and strong demand.
• 2025 saw market consolidation, with large caps outperforming; 2026 is expected to deliver low teens returns with FIIs likely returning.
• RBI may undertake further rate cuts in 2026, assuming normal monsoons and benign inflation, after initial wait-and-watch.

Why It Matters: Chawla sees strong earnings growth and FII return in 2026, favoring consumer discretionary and healthcare.