Mumbai: Stocks of consumption-oriented companies have surged since the beginning of the year as investors heartened by the weak impact of demonetisation on sales look forward to a spending boom fuelled by a good monsoon and a wage hike for government employees. With lower interest rates, people believe it will be beneficial for consumption over the long term, more so for consumer durables,” Rawal said, explaining the surge in prices of stocks of companies manufacturing consumer durables. The top performers among the BSE consumer durables index so far this year were Nilkamal Ltd, Crompton Greaves Consumer Electricals Ltd and Titan Co Ltd, which have gained 37.3%, 34.5% and 32.2%, respectively. Consumption stocks were set to look up in the second half of 2016 due to the wage hike, and a good monsoon that followed two years of drought. Muthukrishnan said entry-level consumption has picked up for consumer durables, and a rural recovery is in the offing.

Source: Mint February 12, 2017 19:50 UTC