There are zero per cent chances of receiving deficient rainfall in India while the possibility of normal to excess rainfall is 96 per cent, according to IMD director general Laxman Singh Rathore. Cheering the statement, agri-related stocks rallied in the morning trade on bourses.
Tractor companies such as Mahindra & Mahindra and Escorts climbed as much as 1.40 per cent and 1.30 per cent, respectively, in the early trade on Friday. Two-wheeler majors such as Hero MotoCorp, TVS Motor and Bajaj Auto gained as much as 2.2 per cent, 3.74 per cent and 2.43 per cent, respectively.
Hero MotoCorp shares also hit their new 52-week high of Rs 3,207.90 in Friday’s trade.
Prospects of a better monsoon, new product launches and salary hike to government employees will provide a one-time demand boost to all automobile segments in the country, according to global rating firm Fitch.
July and August are expected to receive 107 per cent and 104 per cent of rainfall of the Long Period Average (LPA). Releasing the second Long Range Forecast, Rathore said there is not much difference between the initial forecast by the agency and the monsoon season (from June to September) will receive 106 per cent of rainfall of the Long Period Average, which is “above normal”.
Monsoon rains play a key role in boosting demand for an array of consumer goods, as 70 per cent of the country’s 130 crore people live in villages, according to Reuters.
FMCG major Hindustan Unilever gained over 2 per cent intraday. Meanwhile, Jain Irrigation System and Insecticides India also gained 1.3 per cent and 3.23 per cent in the early trade.
Fertilzers & Chemicals Travancore was trading 1.5 per cent up at Rs 24 in the morning trade.
(With inputs from agencies)