- 16 Apr 2024
- ICICI Securities
IMD FORECASTS ABOVE NORMAL RAINFALL IN UPCOMING MONSOON SEASON 2024 AT 106% OF LPA
News: In its long-range forecast for the upcoming Monson season 2024, IMD in its press release yesterday has forecasted monsoon to be above normal in nature with rainfall at 106% of LPA (long period average). Monsoons accounts for ~70% of total rainfall received annually in India.
Views: It is indeed a positive development with all domestic and global weather monitoring agencies forecasting normal to positive monsoon for India in 2024. Notably, IMD press release assigns 61% probability to above normal and excess rainfall categories, 29% to normal rainfall category and just 10% to below normal domains. Abundant rainfall is positive for entire rural consumption play which includes FMCG, consumer durables and automobile especially tractor and 2W segments. It will rainfed the upcoming Kharif crop while at the same time fill reservoirs which will be eventually used for Rabi crop thereafter. Our top beneficiary of healthy monsoons would be Mahindra and Mahindra which is the leader in the tractor space (market share at 40%+) and LCV segment.
Impact: Positive