FMCG index outperforming Nifty50 by wide margin; will bulls hold the string for long?

India’s fast-moving consumer goods (FMCG) sector is outperforming the market, according to money managers and analysts who expect the trend to continue in the near to medium term. The Nifty FMCG index has returned almost 16% year-to-date compared to the benchmark Nifty50, which has returned about 3%. The run in the FMCG index has been broad-based, including gains in both large-cap and mid-cap stocks, due to commodity prices easing and demand showing signs of recovery. Analysts are bullish on the sector’s growth prospects, especially in light of favourable monsoon forecasts.