FMCG not safe-haven bets for investors, analysts see more underperformance

The FMCG index had outperformed the broader market in previous corrections like in 2011, 2015, and 2018

The NSE FMCG (fast moving consumer goods) index has declined 9 per cent since the end of September against a 4 per cent fall in the benchmark Nifty50. On Monday, too, the FMCG index marginally underperformed, declining 1.8 per cent against 1.65 per cent in the Nifty50.

This is unusual, because historically India’s top FMCG companies have acted as a good hedge against volatility.

The NSE FMCG index had declined by only 9.3 per cent in January-March 2020, against nearly 30 per cent fall in the Nifty50. In fact, segment leaders like Nestlé India and Hindustan Unilever (HUL) had rallied. For example,