The News International Team
1:30 pm Interview: Most FMCG companies have a fairly decent proportion of their cost structure based on crude oil be it paraffin oil, detergent inputs or packaging material. So there will be gains definitely on the basis of falling prices, but it will vary on company’s cost structure and product portfolio, says Harsh Mariwala, Chairman of Marico.
However, he expects the benefits to show in margins by Q1FY16 because of inventory stocks. Mariwala hopes to see some positive rub-off effect of falling crude oil prices on other commodities also, like coconut oil. The company had marginally raised price of 175-ml Parachute pack by 0.8 percent. “In our case, we are very clear that if there is a price drop, then we will not hesitate to pass on the benefits to consumers,” Mariwala said.
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The market is still flat. The Sensex is down 52.08 points at 27533.19 and the Nifty is up 9.45 points at 8332.45. About 1420 shares have advanced, 1224 shares declined, and 345 shares are unchanged.
BHEL, Cipla, Axis Bank, Wipro and M&M are top gainers while ONGC, HUL, Infosys and GAIL are among the losers in the Sensex.
Oil prices continued their rout with Brent crude and US. WTI both falling to their lowest in almost six years, as a persistent global supply glut offset data showing record high imports by key consumer China.
The benchmark prices have plunged 60 percent from their 2014 peaks hit in June, dragged down by losses of more than 36 percent seen in the past seven weeks. Overseas investors bought Indian shares worth of Rs 245 crore on Monday, provisional exchange data showed, after selling shares worth USD 517.57 million in the past four consecutive sessions.