FMCG Stocks Outlook
May correct more next week; valuations seen competitive
This story was originally published at 21:15 IST on 28 February 2025
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MUMBAI – Shares of fast-moving consumer goods companies are expected to see some more correction next week as they are trading at competitive valuations, analysts said. The Nifty FMCG index closed at 50689 points on Friday after falling to a 21-month low of 50546.85 points. Lacklustre earnings for the December quarter and selling pressure in the market has led to the fall in shares of FMCG companies.
Rise in prices of raw materials had affected the profit margins of FMCG companies in the December quarter, Onkar Kelji, research analyst at IndSec Securities, said. However, tweaks in income tax slabs and relaxation in key interest rates are expected to help discretionary spending, with the impact seen in the June quarter of 2025-26 (Apr-Mar), he said.
"...short-term outlook is not that bullish," Kelji of IndSec Securities said. Market participants are also watchful of prices of raw materials after several companies reported inflationary pressures in several commodities. The surge in prices of palm oil, a key raw material for the sector, in the December quarter was due to imposition of fresh duty by the government to safeguard domestic oil produce, Emkay Global Financial Services said in a report Wednesday. Prices of palm oil may remain high due to restrained supply ahead, according to the Emkay Global report. Some companies hiked prices of products to pass the inflationary pressure to consumers. However, price hikes amid healthy household inflation are tough from the volume and competition perspective, analysts said.
FMCG players such as Bikaji Foods International, Britannia Industries, Hindustan Unilever, Godrej Consumer Products, Gopal Snacks, ITC, and Nestle India are looking to restore gross profit per unit in the near-term, while any gross margin recovery is contingent on expected easing, Emkay Global said in the report.
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Following are the resistance and support levels for the stocks for next week as per calculations by Informist based on their prices on the National Stock Exchange:
| Company | Price | Week-on-week change in % | Resistance | Support |
| Adani Wilmar | 246.15 | (-)5.50 | 251.80 | 237.30 |
| Britannia Industries | 4595.45 | (-)4.90 | 4877.90 | 4412.60 |
| Colgate Palmolive India | 2464.60 | 0.20 | 2508.10 | 2428.30 |
| Dabur India | 493.30 | (-)3.00 | 509.80 | 482.60 |
| Emami | 529.95 | (-)4.80 | 565.90 | 489.80 |
| Godrej Consumer Products | 1005.15 | (-)4.50 | 1075.50 | 964.20 |
| Hindustan Unilever | 2190.25 | (-)2.30 | 2272.30 | 2144.80 |
| ITC | 395.00 | (-)1.50 | 406.90 | 386.30 |
| Jyothy Labs | 322.40 | (-)6.10 | 341.70 | 310.00 |
| Marico | 600.60 | (-)3.90 | 634.20 | 581.20 |
| Nestle India | 2189.65 | (-)1.10 | 2299.90 | 2129.90 |
| Procter & Gamble Hygiene and Health Care | 13541.90 | (-)1.30 | 13958.30 | 13203.40 |
| Tata Consumer Products | 963.70 | (-)4.00 | 1018.30 | 930.00 |
| Varun Beverages | 436.05 | (-)8.70 | 467.70 | 413.80 |
| Nifty FMCG | 50689.00 | (-)2.70 | 52422.70 | 49680.00 |
| Nifty 50 | 22124.70 | (-)2.90 | 22572.10 | 21881.10 |
| S&P BSE Sensex | 73198.10 | (-)2.80 | 74681.80 | 72399.40 |
End
Reported by Simran Rede
Edited by Ashish Shirke
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