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Informist, Friday, Sept. 12, 2025

 

MUMBAI – Shares of fast-moving consumer goods companies are not expected to see significant movement as analysts say these stocks have already rallied in anticipation of reforms in goods and services tax. FMCG stocks rose following the changes in tax rates, and investors booked profits following the rise, analysts said. 

 

The reduction in tax rates is seen as sentimentally positive for the sector, but is not expected to boost demand sharply. The volume growth of companies is likely to recover gradually and is unlikely to be "supernormal", an FMCG analyst at a domestic brokerage said. "You won't buy more biscuits and soaps simply because it's cheaper," the analyst said.

 

The revival of demand in the FMCG sector will be moderate in Oct-Mar and there will only be a gradual recovery going ahead, analysts say. While some analysts are wary about the revival in demand after GST cuts, others say this will be a very big move for the sector.

 

"We see improving macro tailwinds continuing to support the sector's elevated valuations, even as growth support is still awaited," Emkay Global Financial Services said in a report. The new GST rates will improve consumption and encourage informal businesses to formalise and become more competitive, analysts said. Meanwhile, premium consumers, less influenced by minor price changes, would seek more unique and high-quality products to justify their higher cost, they said.  

 

Following the GST rationalisation, CareEdge Ratings expects CPI inflation to reduce by 70–90 basis points on an annual basis under the current CPI basket. "Lower GST rates will cushion the impact of an anticipated increase in CPI next fiscal year because of a low base," the brokerage firm said. India's headline CPI inflation rose to 2.07% in August from an eight-year low of 1.61% in July because of a rise in food prices, data released by the statistics ministry Friday showed. This is the first time CPI inflation has risen in 10 months and the seventh consecutive month when it is below the Reserve Bank of India's medium-term target of 4.0%. "Strong June quarter growth reduces the likelihood of RBI rate cuts, but persistent high US tariffs and softer inflation from GST rationalisation could open room for further easing," the broking firm said.

 

On Friday, the Nifty FMCG index ended at 56557.15 points, down 0.7%. Only two of the 15 index constituents ended the session with gains. Immediate resistance for the Nifty FMCG is pegged at 57400 points and immediate support at 54400 levels, Vipin Kumar, assistant vice-president of equity research and senior derivatives analyst at Globe Capital Market, said. Over the week, the index rose just 0.5%, underperforming the Nifty 50, which rose 1.5%. 

 

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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
AWL Agri Business	260.40	(-)0.90	263.30	257.50
Britannia Industries	6247.00	2.80	6325.00	6168.00
Colgate Palmolive India	2353.70	(-)2.90	2400.20	2311.40
Dabur India	538.85	(-)1.40	549.30	528.50
Emami	601.95	(-)0.50	612.60	589.80
Godrej Consumer Products	1249.70	1.50	1281.40	1219.80
Hindustan Unilever	2580.50	(-)2.00	2652.70	2532.90
ITC	413.75	1.60	418.80	410.40
Jyothy Labs	325.20	(-)2.00	328.20	322.90
Marico	734.55	0.40	742.30	727.80
Nestle India	1217.60	0.80	1230.20	1203.20
Procter & Gamble Hygiene and Health Care	13198.00	(-)2.20	13388.70	13076.70
Tata Consumer Products	1103.90	2.90	1116.90	1088.70
Varun Beverages	469.80	0.00	479.30	463.90
Nifty FMCG	56557.15	0.50	57319.40	56049.40
Nifty 50	25114.00	1.50	25198.60	24995.80
S&P BSE Sensex	81904.70	1.50	82197.80	81494.80

 

End

 

Reported by Simran Rede

Edited by Avishek Dutta

 

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