Barclays Equity Research expects Q4 FY14E for India consumer space to have remained weak with sustained volume weakness, downward margin pressures due to input cost spike and high ad spend and continued moderation in rural spends, as highlighted by firms.
''In our view, multiples have turned expensive, dissociated from operational performance, with the BSE Consumer Index outperforming the Sensex by c7% in Q4, after underperforming by c14% in H2CY13,'' it said.
''Despite a modestly improving environment (appreciating INR & easing input costs could bring margin tailwinds in FY15E), in our view, a sustained inflation improvement, strong economic growth support and valuation upside potential are key for a positive stance,'' it added.
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