FMCG SECTOR

The Indian FMCG sector is the fourth largest in the Indian economy and has a market size of $13.1 billion. This industry primarily includes the production, distribution and marketing of consumer packaged goods, that is those categories of products which are consumed at regular intervals. The sector is growing at rapid pace with well-established distribution networks and intense competition between the organized and unorganized segments. It has a strong and competitive MNC presence across the entire value chain P/E Ratio A valuation ratio of a company's current share price compared to its per-share earnings.

Calculation Market Value per share Earnings Per Share EPS is usually from the last four quarters (trailing P/E), but sometimes it can be taken from the estimates of earnings expected in the next four quarters (projected or forward P/E). A third variation uses the sum of the last two actual quarters and the estimates of the next two quarters. Also sometimes known as "price multiple" or "earnings multiple".

Company

Industry P/E Ratio

Companys P/E Ratio

Colgate Palmolive Ltd

32.46

34.25

Nestle India Ltd

32.46

44.59

Analysis The P/E ratio of the company is above the industry average, which shows that the price earning is good for the particular stock. Higher P/E ratio shows that the investors are expecting higher returns on the particular stock. Though it is higher than the industry average still it is on a lower side when compared to other companies mentioned here. The P/E ratio is above the industry average. This stock has the best P/E ratio among these companies. So investors would prefer to invest in this company as they expect higher earning on this stock. The P/E ratio is above the industry average. It gives modest rate of return to the investors. So the investors would invest in this company with the anticipation that they will earn substantial amount on this stock. The P/E ratio is below the industry average. Investors may not prefer to invest in this company as the earning is below the industry average. Investors may prefer to invest in some other company in the same sector and earn more returns. This stock earns lowest among all mentioned stocks.

Dabur India Ltd

32.46

39.57

ITC Ltd

32.46

32.14

32.46 Hindustan uniliver Ltd

39.85

The P/E ratio is above the industry average. This stock has the second best P/E ratio among these companies. So investors would prefer to invest in this company as they expect higher earning on this stock.