Fast-moving consumer goods (FMCG) stocks took the lead on Dalal Street on May 23, wrapping up the day as the top sector performer, thanks to ITC’s impressive Q4 results that lifted market spirits across the board.
The Nifty FMCG index surged nearly 2 per cent during the day, with big names like ITC, Varun Beverages, Nestle India, and Tata Consumer making significant gains. This sharp rise comes after a few weeks of lacklustre performance, particularly amid concerns about consumption and high inflation rates.
ITC and Varun Beverages spearhead the rally
ITC shares jumped 3 per cent, reaching an intraday high of Rs 439, breaking a four-day losing streak. The cigarette-to-FMCG giant reported a net profit before exceptional items of Rs 6,416.85 crore, marking a 2 per cent year-on-year increase for the March quarter, driven by growth in its core cigarette segment and signs of a rural recovery.
Varun Beverages also saw a strong performance, climbing over 4.5 per cent to lead the FMCG sector. The stock reached Rs 490.9 on the NSE, bouncing back robustly after six straight days of declines.
Nestle India joined the upward trend, gaining 1.84 per cent to close at Rs 2,405.1. Tata Consumer Products and Dabur India saw increases of 1.39 and 1.01 per cent, respectively, while Hindustan Unilever, Britannia, Marico, and Godrej Consumer finished with modest gains of up to 1 per cent.
What’s fueling the rebound?
Experts point to a mix of better-than-expected earnings from ITC, stabilizing raw material costs (especially palm oil), and early signs of a pickup in rural demand as the main drivers behind the rally.
Brokerage outlook: Who’s in the spotlight?
Brokerages are optimistic about companies like Bikaji Foods, Nestle, and ITC, highlighting improving margins and easing input costs as key factors.
