Consumption declines due to rain, FMCG companies' revenue may decline
FMCG Sector: In a statement issued by FMCG giant Dabur, it was said that due to heavy rains and floods, out-of-home consumption and consumer demand have been affected in the second quarter. This may reduce its revenue by 5-6 percent.
Domestic consumption has declined drastically due to recent heavy rains across the country and floods in many parts. This may lead to a decline in the revenue of FMCG companies in the July-September quarter. On Thursday, this had a direct impact on the shares of these companies, where a decline of up to 6% was seen.
A statement issued by FMCG giant Dabur says that it was said that due to heavy rains and floods, out-of-home consumption and consumer demand have been affected in the second quarter. This may reduce its revenue by 5-6 percent. However, now demand has started improving. Analysts believe that all FMCG companies may be affected by heavy rains and floods.
Dabur India's stock fell nearly 6% on Thursday as investors worried about a drop in revenue and profits. Tata Consumer dropped 3.43 % Varun Beverages 3.63 % Britannia 2.12%, and Godrej Consumer 2.83%.
Macquarie has reduced Dabur's FY25 EPS estimates by 8%. Macquarie has also lowered its target price for Dabur to Rs 560 per share. Broking firms expect the company's sales to rise from October, but sluggish demand is a cause for concern.
