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  • Aug 4, 2022 - ITC is Getting all the Attention. But Here are 5 FMCG Stocks to Watch Out for...

ITC is Getting all the Attention. But Here are 5 FMCG Stocks to Watch Out for...

Aug 4, 2022

ITC is Getting all the Attention. But Here are 5 FMCG Stocks to Watch Out for

In 2022 so far, the Nifty FMCG index has rallied 14%, against a fall of 2% in the Nifty 50 index.

These days, every investor out there is talking about ITC, a leader in the fast-moving consumer goods (FMCG) sector.

ITC was always part of headlines before because of its underperformance. People used to call it a meme stock. Often you would see funny images about ITC on social media.

But now, ITC is in the news for its outstanding results and a sharp rally.

After a decade of underperformance, ITC share price has started to soar due to multiple factors.

If you want to know why ITC is rallying, check out this editorial: ITC: Load, Aim...Fire!

As I write this, ITC share price is trading at its 52-week high. The recent rally is due to outstanding Q1 results.

While everyone is gung-ho on ITC, there are many other FMCG stocks that have given multibagger returns in 2022 and have outperformed ITC.

Here's a list of 5 top-performing FMCG stocks, worth adding to the watchlist...

#1 Vadilal Industries

First on our list is Vadilal Industries.

The share price of Vadilal Industries has zoomed 137% so far this year, making it a multibagger stock of 2022.

The company's share price is just as sweet as its ice cream.

Vadilal Industries is a century-old business that was founded in 1907.

With a market capitalisation of over Rs 15 bn, it is a small-cap FMCG stock engaged in the packaged food industry.

Vadilal is present in over 45 countries, including North and South America, Europe, the United Kingdom, the Middle East, South East Asia, and Australia.

Vadilal's profit jumped by more than 150% from Rs 69 m to Rs 182 m in financial year 2022.

Let's take a look at its quarterly numbers for a clear picture of the company's most recent performance.

Vadilal Industries - Quarterly Performance

  Mar-22 Dec-21 Sep-21 Jun-21 Mar-21
Revenue (Rs m) 1,751.4 909.2 1,466.4 1,314.2 1,407.8
Revenue Growth(%) 92.6 -38.0 11.6 -6.6  
Net Profit(Rs m) 182.8 -110.3 8.2 22.7 69.1
Profit Growth 265.7 -1,440.7 -63.8 -67.1  
NPM % 10.44 NM 0.56 1.73 4.91
Source: Equitymaster

A few setbacks were experienced throughout the year, but the company has managed to overcome those.

The company has definitely made its customers and investors smile.

Let's have a look at company share price performance in 2022.


#2 Sampre Nutrition

The second on our list is Sampre Nutrition.

This small-cap company has rallied 99% in 2022 so far.

The company produces a wide variety of confectionery, including eclairs, candies, toffees, powder, and centre-filled products.

In addition to producing its own brand, the company is instrumental in delivering increasing volumes for most MNCs.

At the beginning of the year, the share price traded at Rs 33, and currently it trades at Rs 66.

During a board meeting in March 2022, the company approved raising funds of Rs 140 m through a rights issue of additional shares.

The company's revenues have been steadily increasing, but it continues to report net losses. Zomato investors will feel a sense of Deja Vu as a similar story is happening with the tech stock.

Let's take a look at its quarterly numbers for a clear picture of the company's most recent performance.

Samore Nutrition- Quarterly Performance

  Mar-22 Dec-21 Sep-21 Jun-21 Mar-21
Revenue (Rs m) 71.3 71.5 61.8 26.7 48.0
Revenue Growth(%) -0.3 15.8 131.1 -44.3  
Net Profit(Rs m) -1.7 2.2 12.8 -10.2 -0.5
Profit Growth -177.4 -83.0 -225.4 2066.0  
NPM % 18.3 11.9 11.6 9.7 9.0
Source: Equitymaster

Here's how Sampre Nutrition has performed in 2022.


#3 Sheetal Cool Products

Third on our list is Sheetal Cool Products.

Sheetal Cool Products share price has jumped more than 60% in 2022.

Sheetal Cool Products is India's fastest-growing company in the FMCG Sector.

It has diversified products ranging from Namkeen, to ice creams, and frozen products.

Based out of the small town of Amreli, Gujarat, over 30 years, the company has grown its multi-distribution network.

The company envisions a turnover of Rs 15 bn by 2030 and have impressions all over the country and even overseas.

Last year, the company's net profit has doubled up to Rs 107 m which stood at Rs 51 m a year ago.

Let's have a look at the company's quarterly numbers for a better image of the performance.

Sheetal Cool Products - Quarterly Performance

  Mar-22 Dec-21 Sep-21 Jun-21 Mar-21
Revenue (Rs m) 1738.5 1529.2 1429.8 889.1 1178.1
Revenue Growth(%) 13.7 7.0 60.8 -24.5  
Net Profit(Rs m) 107.3 77.0 33.2 27.7 51.5
Profit Growth 39.2 131.8 19.8 -46.1  
NPM % 6.2 5.0 2.3 3.1 4.4
Source: Equitymaster

Even in difficult times, the company has consistently delivered solid results, indicating that it is a fundamentally strong stock.

Let's take a look at the company's share price performance in 2022.


#4 Super Bakers

The fourth on our list is Super Bakers.

This Ahmedabad-based company has soared more than 54% in 2022.

Super Bakers (India) is one of the largest manufacturers of bread under the brand name "Super Bread."

Its share price traded at Rs 9 at the start of this year. Today it trades at around Rs 14.

Let's have a look at the company's share price performance in 2022.


#5 Varun Beverages

At last, we have Varun Beverages. Varun Beverages share price has increased more than 50% in 2022 so far.

Varun Beverages is a large-cap company in India's FMCG sector, with a market capitalisation of Rs 604 bn.

Varun Beverages is a major participant in the beverage industry. It is one of the largest PepsiCo franchisees outside of the United States.

The company produces and sells a wide range of carbonated soft drinks (CSDs) and non-carbonated beverages (NCBs).

The company operates 31 manufacturing plants in India and six abroad, including two in Nepal and one each in Zimbabwe, Sri Lanka, Morocco, and Zambia.

The board recently approved an interim dividend of Rs 2.50 per equity share for financial year 2022.

In its latest quarterly result, its revenues more than doubled to Rs 4.3 bn.

Varun Beverages - Quarterly Performance

  Jun-22 Mar-22 Dec-21 Sep-21 Jun-21
Revenue (Rs m) 43,658.3 21,843.7 11,007.1 17,105.6 19,853.2
Revenue Growth(%) 99.9 98.5 -35.7 -13.8  
Net Profit(Rs m) 7,283.3 1,953.6 -197.5 1,459.2 2,380.8
Profit Growth 272.8 1,089.1 113.5 -38.7  
NPM % 16.7 8.9 -1.8 8.5 12.0
Source: Equitymaster

Crazy numbers were reported by the company for the June quarter. EBITDA was reported 119% higher while net profit showed a 152% YoY growth.

The company has been consistently increasing revenues, though it reported net losses in the December 2021 quarter.

Let's have a look at the company's share price performance in 2022.


Investment Takeaway

FMCG sector is an evergreen sector. It co-relates with India's consumption theme.

You rely on FMCG products every day, be it daily essentials such as food and beverages, or household and home care products such as paper goods and cosmetics.

So the future seems to be bright for the FMCG companies in India.

However, do note that FMCG is a sector that fluctuates the most with the tiniest disruption in the market.

Investors should look for the fundamentally strong stocks from the FMCG sector that have steady future prospects.

Since we're talking about Top FMCG stocks, do check out the below video where India's #1 trader Vijay Bhambwani talks about the sector and why it can outperform the market.

Happy Investing!

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...

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