FMCG Stocks Outlook For The Week – 15 to 19.01.2018

FMCG Stocks Outlook For The Week – 15 to 19.01.2018

             Equity Cash/Futures/Options Segment 

The Stocks of fast moving consumer goods companies are likely to continue gaining momentum on the back of improvement in sales volumes in December and January. Companies such as Hindustan Unilever and Emami have gained from increased sales of their winter care range due to prolonged winter in North India. For ITC Ltd, cigarette volumes have recovered from pressure of price hikes in Q2FY18 (Jul- Sep). HUL has played out goods and services tax pass-through intelligently to drive
penetration. We will keenly watch for management commentary from ITC Ltd, which will announce its results on Jan 19. We expect cigarette revenue growth of 7% year-on-year, while volumes would
contract by nearly 2% year-on-year. Price hike would support the cigarette revenue growth. The company's outlook on its agriculture and hotel business would also be keenly monitored. Among bellwether companies, ITC's renewed focus on its biscuits, noodles and deodorant is likely to lead growth for the company in the near term. Amid benign input costs and management's renewed focus on other FMCG business, ITC has turned aggressive with competitive pricing and expanding its distribution network. The company has gained share from competitors in the respective markets.
HUL's products in the face wash and soaps range has gained due to prolonged winters in North India. Toothpaste sales, on the other hand, have gained momentum in south India.

Source : Cogencis Information Services Ltd.

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