Near term margins likely to be under pressure
Among FMCG stocks, Adani Wilmar seems to be better placed at current levels as per the technical charts.
Palm oil is used in products like cooking oil, processed foods, cosmetics and biofuels.
Instead of a recovery in gross margins in fiscal 2022-23 (FY23), Jefferies now builds-in 50-200 basis point (bps) YoY decline, assuming crude stays closer to $100 a barrel and palm oil at $1,500/MT
Despite the correction, analysts at HDFC Securities expects more valuation risks in the next few years
Turnaround hopes and attractive valuations, however, keep the Street positive on the stock
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.
In the past six months, HUL and Britannia have underperformed the market by falling 20 per cent and 15 per cent, respectively, as against 1 per cent decline on the S&P BSE Sensex.
Weak show in India business dents Q3, margin pressures may remain
The Godrej group company had posted a net profit of Rs 502.80 crore in the October-December quarter of 2020.
The Godrej group's FMCG arm expects to deliver close to 'high single-digit' sales growth in the domestic market, largely driven by pricing
There could be pressure in the near term due to sharp rise in commodity costs