This large cap FMCG stock soars 10% post stellar Q4 results; do you own it?

Despite the soaring inflation and rising raw material costs, the domestic FMCG companies have reported better than expected Q4 numbers. Meanwhile, one such company that has exceeded analysts’ expectations is Marico Ltd.

Homegrown FMCG major Marico on Friday reported an 18.68% increase in consolidation net profit to Rs 305 crore for the quarter ended March 31, 2023. The growth was primarily driven by single-digit volume growth and moderately high commodity prices. Also, the revenue from operations stood at Rs 2240 crore as against Rs 2161 crore of the same quarter of previous financial year, a modest growth of nearly 4%. Consolidated EBITDA margin stood at 17.50%. Popular brands like Parachute, Saffola and Livon witnessed good growth for the financial year 2022-23.

“From a category perspective, packaged foods, which have been relatively resilient through the year, continued to drive growth for the sector. We expect the gradual pickup in overall consumption should accelerate the pace of growth in packaged foods,” the company said.

With this, the shares of MARICO have soared about 10% during Monday’s trading session (May 8, 2023) backed by strong buying activity and rising volumes. Shares have hit the day’s high of Rs 539.80 level on NSE during the initial hours.

Technically, the stock now trades above all its key long-term and short-term moving averages, which is a sign of positivity. It has crossed above its prior swing high and technical parameters, indicating bullishness in the stock. The 14-period daily RSI (75.28) lies in the super bullish territory. Meanwhile, the stock has been consolidating in a broader range for over a year now. As per the technical analysis, a breakout above the level of Rs 550 shall be positive for long term while strong support is placed at Rs 460-480 zone.

Long-term investors can keep a close watch over this stock in upcoming trading sessions.