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Mumbai: Fast-moving consumer goods (FMCG) were among the top losers in Monday's trading after Godrej Consumer Products said it anticipated muted demand in its third-quarter business update. Investors must brace for further downside in these stocks as pressure on volumes and margins on account of an urban demand slowdown could extend beyond the third quarter, said analysts. "Since Godrej Consumer is a bellwether stock in terms of volume growth, other stocks have also taken a beating as investors turned cautious of other companies facing similar headwinds," said Ajay Thakur, research analyst- FMCG, Anand Rathi Institutional Equities.Godrej Consumer Products fell nearly 9%, leading a fall in FMCG stocks. Tata Consumer Products slumped 4.1% while Marico, Hindustan Unilever and Dabur shed over 3% each. Colgate Palmolive tumbled 2.9% while Nestle and Britannia Industries fell over 1.5%. ITC closed 1.26% lower.The Nifty FMCG shed 2.2%, while the benchmark Nifty dipped 0.24%. Of the 15 stocks on the FMCG Index, 14 declined while one advanced on Monday.116153496"There was some expectation of better numbers in the third quarter due to the wedding and festive season which didn't pan out as indicated by Godrej Consumer Products," said Amit Agarwal, senior vp and research analyst, Kotak Securities. "Margins are likely to remain under pressure and further derating is expected."Agarwal said that earnings downgrades are likely to follow and at least 10-15% derating in the stocks is expected from the current levels, especially in the urban-focused companies, which is the majority of the FMCG basket.Godrej Consumer Products said that the subdued demand has impacted FMCG market growth in the past few months. The uptick in palm oil and derivatives prices have impacted the soaps category, driving the company to take price hikes, the company said.Analysts said Godrej's commentary suggests volumes take some time to recover. "The valuations are stretched as the margin squeeze and negligible volume growth don't justify the valuations," said Agarwal. "Investors are advised to remain cautious on these stocks as further downside is likely."The Nifty FMCG index declined nearly 12% in the last three month, compared to a 1.3% fall in the Nifty."In terms of valuations, the corrections have been sharp, and most companies are closer to the five-year average," said Amit Purohit, VP- research, Elara Capital. "However, there is no near-term trigger for the stocks."Investors are expected to remain cautious as there are near-term headwinds with respect to demand as of now, said Purohit.From FY26 and FY27 onwards, the street will start building high-single-digit growth for FMCG companies aided by price hikes, he added.Some analysts are bullish on large-cap FMCG stocks. "The stocks have already witnessed quite a lot of corrections, and the valuations are attractive," said Thakur. "Hindustan Unilever and Godrej Consumers are trading attractively priced and offer good buying opportunity from a two- to three-year view."

Indian benchmark indices ended in red for the second session in a row dragged by FMCG and auto stocks. While the S&P BSE Sensex settled at 81,508.46, down by 200.66 or 0.25%, the broader Nifty50 closed at 24,619, lower by 58.80 or 0.24%.Commenting on the day's action, Dr. Praveen Dwarakanath, Vice President of Hedged.in, said that momentum indicators continue to show bullishness in the Nifty index despite remaining closer to the overbought levels. "Nifty is consolidating near its resistance level of 24,850. The last two days have shown an insider candle for the index, indicating it has lost momentum. The index trades above the 50-day moving average, indicating that bullishness could continue. Options writer's data for the monthly expiry showed increased writing of the calls and puts at the 24,700 level, indicating a range-bound move in the index," Dwarakanath said.What should traders do? Here’s what analysts said:Jatin Gedia, Mirae Asset SharekhanOn the daily charts we can observe that the Nifty has been consolidating after the sharp upward move in the previous week. We expect the Nifty to consolidate before resuming its upward move. Dips towards support zone 24,550–24,500 should be considered as a buying opportunity. As far as derivative data is concerned, 24,700 CE and 24,600 PE added decent OI suggesting a range bound price action going ahead. The Nifty Weekly PCR stands at 0.75, suggesting a slightly bearish sentiment. However, the price action suggests a range bound price action to continue. The undertone remains bullish and dips towards the support zone should be considered as a buying opportunity.Rajesh Bhosale, Angel OneIn the absence of any significant triggers, the benchmark index Nifty began the trading day on a mildly negative note. Recently, prices have experienced a strong rebound from the swing lows of 23,263. With small body candles forming over the past two sessions, it appears the market has entered a consolidation phase, with bulls taking a pause. On the daily chart, trading above the November swing highs suggests a solid formation, but some hesitation is visible around the 24,750-24,800 range. This zone marks a 50% retracement of the sharp decline from the all-time high of 26,277 to 23,263.For now, this remains a key resistance level, and a sustained move above it could open the door for a rise beyond the 25000 mark. On the downside, prices are well above major moving averages, with 24400 coinciding with the 50 DEMA and 89 DEMA, providing strong support in the event of any dips. Traders should monitor the range between 24,400 and 24,800, with a buy on dip and book profits at higher ranges. Hrishikesh Yedve, Asit C. Mehta Investment Intermediates Technically, on the daily chart, the Nifty index formed a small red candle. However, the index is still holding above its recent breakout mark of 24,550. Thus, any dips near 24,550 would offer a good entry point for the short term. On the downside, 100-Days Exponential Moving Average (100-DEMA) support is placed near 24,330. As long as the index sustains above it, traders are advised to adopt a buy on dips strategy. On the upside, the index could test the levels of 24,800-25,000 in the short term.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

The government on Monday appointed Sanjay Malhotra as the new Governor of the Reserve Bank of India (RBI), fizzing out rumours on extension of term for incumbent governor Shaktikanta Das. Malhotra, a seasoned bureaucrat, will be the 26th governor of the apex bank, succeeding Das, whose term is set to end Tuesday.Das, who was appointed as the RBI Governor in December 2018, has already surpassed the typical five-year tenure that has been standard in recent decades.Who is new RBI Governor Sanjay Malhotra?Malhotra, a 1990 Batch Rajasthan Cadre IAS Officer, will assume office n December 11, 2024 for a period of three years, the appointment committee of the cabinet said in a notification. His appointment comes at a critical juncture as the RBI battles challenges like inflation control and slowing down of economic growth.Malhotra is currently serving as Secretary (Revenue) in the Ministry of Finance. Previously, he held the position of Secretary in the Department of Financial Services.Also Read: Who is Sanjay Malhotra, the new RBI governor appointed by the central govt?About 25th RBI Governor Shaktikanta DasAs for Das, prior to his appointment at the RBI, he was a key official in Prime Minister Narendra Modi's administration and played a critical role during a period marked by strained relations between the government and the central bank.Before becoming RBI Governor, Shaktikanta Das served as a Member of the 15th Finance Commission and as India’s G20 Sherpa. With over four decades of experience in governance, he held pivotal roles in both central and state governments, focusing on finance, taxation, industries, and infrastructure.During his tenure at the Ministry of Finance, Das was actively involved in crafting eight Union Budgets, showcasing his deep expertise in fiscal policy. He is a postgraduate from St. Stephen’s College, Delhi University.After assuming charge at the Mint Street office, Das quickly restored confidence in the markets, which had been shaken by the abrupt resignation of his predecessor, Urjit Patel, amid a contentious dispute between the RBI and the government over surplus transfer issues. His steady leadership helped ease tensions and set the stage for greater collaboration between the central bank and the government.