Quote on consumer durable`s sector outlook By Anil R, Geojit Financial Services
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Below the Quote on consumer durable`s sector outlook By Anil R, Research Analyst at Geojit Financial Services.
Inflation in India has risen resulting in many consumers to delay or cancel buying new consumer durables. Further, the prices of raw materials used in the production of consumer durables, such as steel, copper, and plastic, have risen sharply in the post-Covid era. This elevated raw material price is due to several factors, including the global economic recovery, supply chain disruptions, and the war in Ukraine. This has increased the cost of durables while growth of disposable income has reduced due to slowing economy and increase in average cost of borrowing by 200 bps in the last 1yr. However, if we take a slightly medium-term view, inflation is expected to moderate, as indicated by the moderating April inflation print of 4.7% from 5.66%. Further, real estate and construction demand remain steady, which is anticipated to drive consumer spending going forward.
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