Discretionary spending likely to remain muted in near term
News: According to the Economic Times, slowdown in discretionary purchases by consumers is likely to continue for a few more months and revival is expected to start from H2FY24. Consumers have lowered their spending on products such as electronics. Revival in demand is likely to be supported by lower inflation and normalized economic growth.
Views: We believe that lower discretionary spend has impacted the demand for consumer durables. Product categories such as fans, appliances, consumer lightings have seen a weak volume offtake in Q4FY23. We believe continuing slowdown in discretionary spend is likely to impact FMEG companies such as Bajaj Electricals, Crompton Greaves, Havells, Voltas and V-Guard under our coverage .
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