FMCG pack will continue to do very well: Harendra Kumar, Elara Capital

In a chat with ET Now, Harendra Kumar, Head of Institution Broking and Global Research, Elara Capital, shares his views about FMCG pack.

ET Now: What is your call on the entire FMCG pack?

Harendra Kumar: What I have been telling all our clients and the market at large, is that the FMCG companies are no longer defensives. It is a misnomer to call them defensives. Look at the growth, 21% on a quarterly basis. So, there is a huge upsurge in rural demand. There is good pricing power. There is strong demand in the economy. Valuations are to be looked on a relative basis, today they are at 30 PE. So, there is huge catch up in terms of valuations that they have to do. My guess is that given the state of the economy where consumption is strong and investment cycle is low, you will see consumption stocks and FMCG stocks continue to do very well in the run up to the next 2 quarters.