FMCG Stocks Sizzle as Demand Revival Hopes Heat Up Street

The fast moving consumer goods sector is showing signs of a revival after struggling through multiple challenges in recent years.

While FMCG counters had lagged the broader market rally in the past few quarters on subdued rural demand and inflationary pressures squeezing margins, the tide seems to be turning now.

Positive commentary from management teams about improving demand conditions, especially from rural India, is fueling investor sentiment.

This bodes well for the sector as rural India contributes over 35% to overall FMCG volumes.

With crop prices and minimum support prices rising, expectations of a bumper harvest are stoking rural optimism.

The upcoming general elections and budget are also likely to enhance rural spending power through various populist measures.