Thursday, 6 November 2008

India Infoline positive on FMCG Sector

India Infoline continues to remain positive on the FMCG sector with ITC and Marico as their top picks.

India Infoline's report on FMCG Sector:

Performance of most companies in our universe was in line with our expectations during Q2 FY09. All companies recorded double digit revenue growth led by strong volume growth across segments. However, operating margins remained under pressure due to a sharp rise in raw material prices. Over the past month, most of the key raw material prices like LAB, crude oil and palm oil have started correcting and are expected to ease the margin pressure in the coming quarters. Food companies though, are likely to continue to witness margin pressure on account of firm agri commodity prices. Most players have taken measures like price hikes and reduction in pack sizes to mitigate cost pressures. We continue to remain positive on the sector with ITC and Marico as our top picks.

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Source: Moneycontrol

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