A fresh note from Morgan Stanley turns selective on India’s discretionary and retail pack at a time when inflation risks are building again, and demand visibility is uneven. The brokerage singles out a handful of names where earnings drivers remain intact for FY27. It also cut its stance on one company, citing near-term pressure on growth and margins.
The report, dated April 17, 2026, lays out where they see resilience and where caution is warranted as macro conditions turn less supportive.
Morgan Stanley on Titan Company: ‘Overweight’
Morgan Stanley retains an ‘Overweight’ call on Titan Company with a target price of Rs 5,102 and sees an upside of 14% from the current market price of Rs 4,461. The brokerage builds its case around strong jewellery demand supported by elevated gold prices and company level execution through schemes and customer offers.
It expects revenue growth momentum to hold through the first half of FY27 if gold prices remain around current levels, which could translate into better operating performance even in a mixed consumption environment. The firm also factors in continued traction in store level productivity and brand strength, which has historically helped Titan manage cycles better than peers.
“In a volatile geopolitical environment with visible inflationary trends, we prefer discretionary and retail stocks where growth levers are in place for FY27 and are relatively insulated,” Morgan Stanley says in the report.
Morgan Stanley on Avenue Supermarts: ‘Overweight’
Morgan Stanley keeps Avenue Supermarts, the operator of DMart stores, at ‘Overweight’ with a target price of Rs 5,188, implying a 17% upside from the current market price of Rs 4,246. The brokerage points to steady store expansion and better-than-expected operational updates in the recent quarter as key drivers for confidence in execution going forward.
It believes that grocery retail could benefit from inflation as pricing dynamics support same store sales growth, helping offset pressure that may be visible in other discretionary categories. The firm also notes that DMart’s value positioning and efficient cost structure put it in a relatively stronger position as consumers turn cautious on spending.
“Grocery retailers could be beneficiaries of inflation, pricing offers support to same store sales growth,” Morgan Stanley adds.
Morgan Stanley on Trent: ‘Overweight’
Trent also finds a place in Morgan Stanley’s preferred list with an ‘Overweight’ rating, a target price of Rs 4,835 and an implied upside of 18% from the current market price of Rs 4,086.
The brokerage highlights the company’s aggressive store additions and improving traction across formats as reasons for optimism. It notes that recent quarterly updates came in stronger than expected, reinforcing confidence in the company’s ability to sustain growth into financial year 2027.
While broader discretionary demand may soften under inflation pressure, Trent’s execution and expansion pipeline are expected to cushion the impact. “In the current environment, we prefer companies which have strong growth levers in place for F27 and offer relative value,” Morgan Stanley says.
Morgan Stanley on Jubilant FoodWorks: ‘Equal Weight’
Morgan Stanley has downgraded Jubilant Foodworks to ‘Equal Weight’ from ‘Overweight’, cutting its target price to Rs 486 from Rs 693 earlier. At the current market price of Rs 459, the implied upside stands at 6%. The downgrade reflects concerns around slowing demand, rising costs and weaker operating leverage in the near term.
The brokerage expects consumption conditions to remain soft, especially in quick service restaurants where consumers are more price sensitive. It also flags higher input costs linked to liquefied petroleum gas supply constraints as a margin risk in the coming quarters. Even though the stock has corrected sharply, the firm does not see enough triggers for outperformance in the immediate future.
“Rising inflation is negative for consumption in general, but the extent and impact on companies differs,” Morgan Stanley adds.
Conclusion
Morgan Stanley’s latest call on India’s consumption pack rests on selectivity rather than a broad based view. Titan, DMart and Trent stand out in its coverage with steady earnings visibility and execution strength, while Jubilant FoodWorks faces a tougher near term path despite the recent correction in its share price. The brokerage’s positioning reflects a market where inflation, uneven demand and external risks are beginning to weigh on consumption, making stock specific drivers more important than sector wide trends.
Disclaimer: Investment details and target prices mentioned are based on a report by Morgan Stanley and are for informational purposes only. These do not constitute an offer, solicitation, or specific investment advice to buy, sell, or hold any security. Investing in equities involves market risks; readers are advised to consult a SEBI-registered investment advisor before making any financial decisions based on these brokerage views.
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