ITC, HUL, Dabur, and others have risen up to 26% in six months

ITC, Hindustan Unilever, Dabur India, and others have seen share prices rise by up to 26% in the last six months thanks to increased demand. Good monsoon weather is also benefiting the rural economy. This positive trend is seen in the Nifty FMCG index, which is up about 20% since June 2024.

Antique Stock Broking reported that the rural market, making up 52% of sales, has struggled for four years due to COVID-19 and high inflation. However, as global conditions improve and the domestic market recovers, interest from investors is expected to rise as rural demand picks up.

Key factors boosting demand include falling rural inflation and slowly rising real wages. Good monsoon rains and higher Minimum Support Prices (MSPs) for crops like pulses will also help.

Analysts think the food sector will do better than home and personal care products, which may grow more slowly. While the overall FMCG sector is likely to benefit, quicker growth is expected in areas like jewellery and affordable clothing, with luggage and footwear markets also being monitored.

Additionally, lower crude oil prices could benefit various consumer companies, especially in the paint industry, like Asian Paints, Grasim, and Berger Paints.