Mumbai, March 30 (IANS) The S&P BSE consumer durables and capital goods indices touched their 52-week high levels on Thursday, thanks to soaring summer temperatures across western, central and northern India pushing up sales of home appliances like air conditioners and fans.
Both the consumer durables and the capital goods indices touched their 52-week high levels. The consumer durables surged to 15,132.34 points, and the capital goods index 16,335.61 points.
“Next three months are expected to be some of the hottest in recent times, according to weather forecasters. Home appliances companies, especially those in refrigerators, air conditioners and fans are naturally to benefit from this,” Vijay Singhania, founder and Director of brokerage firm Trade Smart Online, told IANS.
The India Meteorological Department has declared heatwave condition in almost nine states of the northwest, west and central India, including states of Rajasthan, Gujarat and Maharashtra.
According to an India Brand Equity Foundation (IBEF) report, the consumer durables market is expected to reach US$ 20.6 billion by 2020.
“Demand for durables like refrigerators as well as consumer electronics goods is likely to witness growth in the coming years in the rural markets as the government plans to invest significantly in rural electrification,” the report said.
Moreover, the increased demand for capital goods was attributed to the government’s huge allocation of funds for the country’s infrastructure development.
“Capital goods stocks are reflecting the increased order flow from government bodies. Government in its Budget had already mentioned the increased allocation for infrastructure. Capital goods stocks are reflecting the changing dynamics on the ground,” Singhania added.
Vinod Nair, Head of Research at Geojit Financial Services, said: “Improvement in execution and expectation for better order inflows in the future on account of pick-up in capex (capital expenditure) from power T&D (transmission and distribution), railways, roads has been driving the capital goods sector.”
In the BSE, the consumer durables index closed the day’s trade at 15,098.42 points — up 206.17 points or 1.38 per cent.
Similarly, the capital goods index closed higher by 89.02 points or 0.55 per cent at 16,285.88 points.
Among individual stocks in the consumer durables segment, Whirpool India (up 3.01 per cent), Blue Star (up 2.53 per cent) and Crompton Greaves Consumer Electricals (up 2.25 per cent) closed with gains.
Suzlon (up 6.58 per cent), Reliance Defence and Engineering (up 3.13 per cent) and Havells India (up 2.10 per cent) were among the leading stocks in the capital goods sector.