www.rupeedesk.in
We believe stocks of fast-moving consumer goods companies are likely to under-perform
the market over the next few weeks as investors are likely to focus on high-beta
stocks. The BSE FMCG Index rose 2% this week to 6612.33, while the benchmark Nifty
surged 4%. Investors that till now kept away from riskier sectors of the economy like
banking, metal and infrastructure are ready to put money in them as the 'risk-on' trade has
begun. FMCG, which was one of the out-performers over the last few years, is now likely
to consolidate.
Within the FMCG universe, most bullish on Agro Tech Foods. The company is
introducing a host of new products like peanut butter and milk-based snacks that enjoy a
healthier profit margin compared to its traditional products like edible oil. We see sales of
new products growing at a stronger pace, as most of the products are leaders in their
categories. Higher stock of new products in the company's revenue mix will help Agro
Tech Foods to improve its overall profitability.
We believe stocks of fast-moving consumer goods companies are likely to under-perform
the market over the next few weeks as investors are likely to focus on high-beta
stocks. The BSE FMCG Index rose 2% this week to 6612.33, while the benchmark Nifty
surged 4%. Investors that till now kept away from riskier sectors of the economy like
banking, metal and infrastructure are ready to put money in them as the 'risk-on' trade has
begun. FMCG, which was one of the out-performers over the last few years, is now likely
to consolidate.
Within the FMCG universe, most bullish on Agro Tech Foods. The company is
introducing a host of new products like peanut butter and milk-based snacks that enjoy a
healthier profit margin compared to its traditional products like edible oil. We see sales of
new products growing at a stronger pace, as most of the products are leaders in their
categories. Higher stock of new products in the company's revenue mix will help Agro
Tech Foods to improve its overall profitability.
