Not expecting incremental money to go into the FMCG space: Mehraboon Irani, Nirmal Bang Securities

In a chat with ET Now, Mehraboon Irani, Principal & Head-Private Client Group Business of Nirmal Bang Securities, shares his views on the FMCG space. Excerpts:

ET Now: How do you analyse the FMCG space? There are early signs that probably on ground, things are gradually improving. Which are the stocks you are approaching here, if at all?

Mehraboon Irani: The market has largely discounted this. The best example is a white good sector. If you look at that, even if you call it retail, the fact is that the way valuations have shot up, things will improve and numbers will come.

When it comes to specific FMCG companies, I will include names like Dabur or Colgate or Glaxo Consumer or an ITC or Lever. In terms of valuations, most of them are fairly valued or slightly overvalued.

Coming to the specific question, if any, it would be ITC. I have been stating it for the last six months that you give me an index of 25,000 or 30,000 or 32,000. I do not see ITC going above 375 at least for the next six more months. The fact is, as a stock, it is fully valued. It gives you a feeling of satisfaction. Even if the market comes down suddenly by 2-3 per cent, that is a great stock.

The fact is that I do not see incremental money going into the sector in general and ITC in particular, at least for some more time in a market in which people feel that cyclical upturn for the Indian economy is beginning.