ETMarkets Investors’ Guide: Do consumer stocks remain the best defensive bets for investors?

Consumer stocks are the best defensives in the Indian stock market, right? Wrong. As soon as the second wave of Covid hit us, the market’s attention naturally shifted to defensives like IT, pharma and FMCG stocks. But while IT and pharma outperformed the market, FMCG has lagged behind and even eroded 2 per cent of investor wealth in the last one month.

In today’s special podcast with independent market expert Rajiv Nagpal, we put consumer stocks under the lens to understand why the market is punishing these traditional defensives this time around. Listen in.

Welcome to the show Mr Nagpal.

1) Can you explain the factors behind the recent underperformance of consumer stocks?

2) What have you gathered about the demand outlook for consumer staples and durables from management commentaries that have come in so far?

3) Shouldn’t FMCG stocks like Nestle, Britannia, ITC and HUL be a safe place to hide in such a volatile environment?

4) If the input cost pressure persists for some more time, how much pricing power does FMCG biggies have to be able to pass on the price hike? The inflationary outlook is already raising eyebrows.

Thank you Mr Nagpal. That’s all in today’s special podcast but keep checking this space for more such interesting content. Good bye!