FMCG Stocks Outlook for the week – 21 to 25.07.2014
(www.rupeedesk.in)
(www.rupeedesk.in)
We expect stocks of fast-moving
consumer goods companies to continue to remain
muted in the week ahead as the market
is seen focusing on sectors like banking and
energy that are driven by policy
measures. For the week ending Jul 18, the BSE FMCG
index fell 0.1%, significantly
under-performing the benchmark Sensex that gained 2.5%.
The monsoons have normalised and
market is more interested in watching what the
government will do to boost the
infrastructure, oil and gas and banking space. FMCG
stocks will be out of focus till
week-after-next, when big companies will start announcing
results.
FMCG companies are straddled with
high raw material prices of some key ingredients,
but price hikes of these products are
likely to be spread over a longer time period to
cushion the blow for customers. For
example, the average price of CTC tea (crush, tear,
curl) is up 39.3% since May, and is
expected to rise by another 10 rupees a kg over the
next one month, if the crop shortfall
continues. Colgate Palmolive India will be the first
FMCG player to report Apr-Jun
earnings next Friday.
