COVID-19 Hits Consumer Buying

[komal]

Credit Suisse in a Report said that COVID’s uncontained spread extends hit to consumption

COVID continues to spread with a rising number of new reported cases and no flattening of the curve. The worst impacted are the large cities and media reports. They consumers to avoid non-essential out-of-home visits which would extend the impact on consumption.

Pattern of strong foods and weak personal care consumption to extend - (1) strong growth in home categories such as biscuits, noodles, branded tea/coffee, home insecticides; (2) a pick-up in healthcare and hygiene products; and (3) a decline in personal care/out-of-home products such as shampoo, hair oils, skin creams and ice cream.

Consumer discretionary
CS sees highest headwinds for discretionary companies which have a high salience of sales from top 10 cities such as Avenue, Jubilant, Page Industries and Titan.

They Downgrade Avenue Supermart to UNDERPERFORM (from Neutral) and Jubilant to NEUTRAL (from Outperform)

Company -

Stock Target

HUL - 2400
Emami - 240
United Spirits - 575
DMART - 2000
Jubilant 1625
Page Industries - 14100
Asian Paints - 1850
Pidlite - 1100