BSE FMCG index nears 52-week low; Dabur, Godrej Consumer slips up to 9%

HUL hit a fresh 52-week low of Rs 1,942, down 4% in intra-day trade today. The stock has tanked 15% in the past two weeks.

Shares of fast moving consumer goods (FMCG) companies continued to reel under pressure with most of the frontline stocks from the sector trading at their respective 52-week lows as operating environment in the near-term is likely to remain challenging due to rising commodity inflation.

Godrej Consumer Products plunged 9 per cent, while Emami and Dabur India slipped 7 per cent and 6 per cent, respectively, on the BSE in Monday’s intra-day trade. Britannia Industries, Procter & Gamble Hygiene & Health Care, CCL Products, Marico and Hindustan Unilever (HUL) were down between 4 per cent and 5 per cent on the BSE.

The S&P BSE FMCG index hit a 10-month low of 12,355, down 3 per cent in intra-day trade. It was trading close to its 52-week low of 12,091 hit on March 15, 2021. In the past one month, the index has fallen 9 per cent in line with the benchmark S&P BSE Sensex. Including HUL, Britannia Industries, Dabur India and Gillette India, total eight stocks from the index hit their respective 52-week lows today.

FMCG market growth is soft with rural volume pressure more acute than that of urban markets. The near-term operating environment remains challenging, with higher inflation expected sequentially.

Among the individual stocks, HUL hit a fresh 52-week low of Rs 1,942, down 4 per cent in intra-day trade today. In the past two weeks, the stock tanked 15 per cent, as compared to a 9 per cent decline in the S&P BSE Sensex.

Analysts at HDFC Securities said near-term demand outlook for HUL continues to be a concern, with rural India witnessing an inflation-led slowdown. Elevated input costs, besides slowing down growth, continued to impact the gross margin, which contracted by 186bps year-on-year in December quarter (Q3FY22). Given the inflationary environment, the brokerage firm expects the gross margin pressure to continue in H1FY23 despite staggered price hikes.

COMPANY	LATEST	PREV CLOSE	LOSS(%)
Godrej Consumer	667.75	725.30	-7.9
Dabur India	507.30	539.45	-6.0
P & G Hygiene	14170.05	14970.35	-5.4
DCM Shriram	958.55	1012.50	-5.3
CCL Products	385.05	406.55	-5.3
Britannia Inds.	3200.00	3371.35	-5.1
Bombay Burmah	889.00	934.65	-4.9
Emami	455.25	478.00	-4.8
Tilaknagar Inds.	66.80	69.95	-4.5
DFM Foods	235.10	246.05	-4.5
Globus Spirits	1317.35	1377.30	-4.4
AVT Natural Prod	87.10	91.05	-4.3
Marico	481.05	500.65	-3.9
Bannari Amm.Sug.	2198.00	2286.10	-3.9
Heritage Foods	301.15	312.40	-3.6
Hind. Unilever	1947.65	2019.90	-3.6
Tasty Bite Eat.	11238.05	11639.05	-3.5
Varun Beverages	901.40	931.85	-3.3
Gillette India	4933.00	5099.25	-3.3
United Breweries	1297.70	1339.05	-3.1