Reuters Market Eye - Hindustan Unilever Ltd (HUL) falls 2 percent.
Morgan Stanley downgrades to "underweight" from "equalweight."
Cites "lofty" valuations despite "weak" earnings growth.
HUL trades at 37.6 times 12-month forward earnings compared with 35 times for peers, Thomson Reuters data shows.
Morgan Stanley says ITC is its top pick in the Indian consumer goods sector.
(Reporting by Abhishek Vishnoi)