Morgan Stanley Upgrades Marico and Nestle India, Downgrades Godrej Consumer as FMCG Stocks Slip

Morgan Stanley Upgrades Marico and Nestle India, Downgrades Godrej Consumer as FMCG Stocks Slip​

On Wednesday, March 4, shares of key fast moving consumer goods companies including Marico Ltd, Godrej Consumer Products Ltd, and Nestle India Ltd were trading lower after global brokerage Morgan Stanley revised its ratings and price targets for the three stocks.

The broader sector also remained under pressure, with the Nifty FMCG index declining 1.5 percent in intraday trade.

Marico Upgraded to Overweight with Higher Price Target​

Morgan Stanley upgraded Marico to “overweight” and raised its price target to ₹934 per share from ₹788 earlier. The revised target suggests a potential upside of 19 percent from the stock’s previous closing price.

The brokerage cited an improving business mix as the key driver behind the upgrade, indicating confidence in the company’s evolving growth profile.

Marico is currently tracked by 44 analysts. Among them, 37 have a buy rating, four recommend hold, and three have assigned a sell rating.

Despite the upgrade, Marico shares were trading 0.6 percent lower around 12:10 PM on Wednesday.

Nestle India Rating Raised to Equal Weight​

Morgan Stanley also upgraded Nestle India to “equal weight” from its earlier “underweight” rating. The brokerage increased its price target to ₹1,370 per share from ₹1,010.

The revised target implies a 7 percent upside from the stock’s previous closing level.

Nestle India is covered by 40 analysts. Of these, 13 maintain a buy rating, 17 recommend hold, and 10 have a sell rating.

Shares of Nestle India were trading 2.5 percent lower around 12:10 PM.

Godrej Consumer Products Downgraded on Near Term Risks​

In contrast, Morgan Stanley downgraded Godrej Consumer Products to “equal weight” and reduced its price target to ₹1,159 from ₹1,315 earlier. The revised target indicates a potential downside of 1.4 percent from its previous close.

The brokerage cited risks to near term consensus expectations as the primary reason for the downgrade.

Godrej Consumer Products is covered by 38 analysts. Among them, 31 have a buy rating, six recommend hold, and one has issued a sell recommendation.

The stock was trading 4.3 percent lower around midday on Wednesday.

FMCG Sector Under Broad Pressure​

The weakness extended across the FMCG space. The Nifty FMCG index declined 1.5 percent, reflecting broad based selling.

Except for United Breweries Ltd, which was trading 0.5 percent higher, the remaining 14 constituents of the index were down between 1 percent and 4.3 percent.

Morgan Stanley stated that it prefers companies that are building unique growth vectors while maintaining profitability, a theme that shaped its latest rating revisions in the consumer sector.