Upbeat on Jubilant Food, Titan, HUL, Godrej Cons; neutral on ITC: Macquarie Capital

Amit Sinha, Consumer Analyst, Macquarie Capital Securities in an interview to CNBC-TV18 spoke about the Q2 earnings for the consumer sector and the outlook going forward.

Speaking from the sidelines of the two day Macquarie India Investor Conference, he said the industry volume growth is gradually recovering on back of signs of recovery in rural market.

The volumes in Q2 were better than Q1 but there is pain still seen in segments like wholesale. General trade and modern trade has done well, he said.

In GST regime, the organised players will gain significantly on account of strucrual price reduction between them and the unorganised, regional players.

So, the outlook for organised and large players is good, he said.

The recent reduction in GST rates for certain items is positive for some consumer staples and consumer discretionary companies, said Sinha adding that players like HUL can gain significantly because of lower retail prices and will also gain market share.

Their top pick from the staple space is HUL and Godrej Consumer Products and from the discretionary space is Jubilant Foodworks and Titan.

The house is neutral on ITC stock but is very positive on long-term fundamentals of the company. The downside for the stock after the recent correction is very limited, said Sinha.