Shares of fast moving consumer goods (FMCG) companies are in limelight on the bourses on hope of good rainfall this year helps increase farm output, which takes up income, impacting sales.
Among the individual stocks, ITC has surged 3% to Rs 32, followed by Hindustan Unilever up 2.5% at Rs 418, Tata Global Beverages, Marico, Dabur India and Nestle India are up 1% each on the Bombay Stock Exchange (BSE).
The BSE FMCG index, the second largest gainer among the sectoral indices, is up almost 2% compared to 1.6% gain in the benchmark index Sensex at 1031 hours.
“Good rainfall impact consumers in general, since food price inflation can be tamed. Today, food constitutes over 50% of the monthly household expenditure of a family in urban as well as rural areas,” the report suggests.
“While headline inflation stood at 7.23%, consumer price inflation, which measures product prices to the end-consumer, was over 8% last month. With the fuel price hike this month, both headline and consumer price inflation are likely to go up,” say experts, added report.
