Shares of Marico Ltd. touched a record today, helped by falling prices of copra—a key raw material used to make coconut hair oil.
The stock of the maker of Parachute coconut hair oil has gained 10 percent so far this year compared with a nearly 11 per cent increase in the NSE FMCG Index during the period.
Prices of copra have fallen about 19 percent since February. They are hovering around Rs 11,000 a quintal compared with Rs 13,500 a quintal in February, according to Bloomberg data. Since then Marico, one of the top five stocks in the FMCG basket, rallied 19 percent.
In May, brokerage Credit Suisse had upgraded the company to ‘Outperform’ from ‘Neutral’, citing the worst is behind for Marico with the copra inflation cycle having run its course. Of the 41 analysts tracked by Bloomberg, 20 have a ‘Buy’ rating on the stock, 15 rate it ‘Hold’, while six recommend ‘Sell’. After the recent rally, the stock is trading near the target prices.