The consumer durables industry was on a comeback trail with television sales scaling new highs, thanks to the football World Cup while air-conditioners and refrigerators sales got a boost due to the extended summer season. In line with the trend, these stocks had shot up by upto 50 per cent in June and touched their 52-week high in early July. However, fears of monsoon failure has proved to be a spoilsport, sending these stocks downhill.
‘‘A delay in monsoon may make farmers shift from cash crops to other less lucrative crops leading to lower incomes. And since most of the demand for the consumer durables industry has been coming from the rural area, these companies are expected to take a hit,’’ said a Delhi-based NSE broker. He added that the cyclical air-conditioner stocks have declined also because the long summer season is approaching its end.
The top losers, Fedders Lloyd and Kalyani Sharp, are both into the manufacture of air-conditioners. These counters have seen the prices decline to more than half. While Fedders Lloyd declined 58.33 per cent to Rs 4 on July 30 from its 52-week high of Rs 9.6 touched on July 5, Kalyani Sharp dipped 53.9 per cent to Rs 6.8 from its peak of Rs 14.75 on July 10.
Price of Videocon Appliances also plunged by about 50 per cent to close at Rs 11.3 from a 52-week high of Rs 22.2 on July 9. Some other small market-cap stocks like Samtel Colour, Matsushita TV and Asian Electronics also shed 44-48 per cent from their peaks to close at Rs 30.25, 7.15 and 26.35 respectively on Tuesday.
A-group stocks like BPL, Videocon International and Voltas also got the drubbing, slipped by 30-37 per cent from their 52-week high. BPL and Videocon had rallied, after they were cleared of charges of price manipulation and granted permission to access the capital markets.