Hindustan Unilever Ltd. and Dabur India Ltd. led gains among Indian consumer-goods makers as investors turned to stocks that retain their value during an economic slowdown after the country’s manufacturing growth slowed to a three-month low.
Hindustan Unilever, the Indian unit of Unilever Plc, rose 2.5 percent to 320.9 rupees, its highest in at least two decades. Dabur India Ltd. gained 2.3 percent to 102.95 rupees.
India’s manufacturing growth slowed to a three-month low in December after the central bank raised interest rates in 2010 at the fastest pace in Asia. The purchasing managers’ index fell to 56.7 from 58.4 in November, HSBC Holdings Plc and Markit Economics said yesterday.
Concerns of slowing growth may be prompting some investors to turn to consumer-goods makers, according to Deven Choksey, chief executive officer at K.R. Choksey Shares and Securities Pvt., which manages about $120 million in assets for wealthy investors.
“Portfolio managers are trying to find some margin of safety when the market takes a fall,” Choksey said. “As long as you have volume growth, inflation will not negatively impact consumer product companies.”
The Bombay Stock Exchange’s Sensitive Index, or Sensex, fell for the first time in five days, losing 0.3 percent to 20,498.72, at the 3:30 p.m. close in Mumbai.
Finance Minister Pranab Mukherjee last week raised his inflation forecast to about 6.5 percent by March 31, more than the 6 percent prediction he made on Dec. 14, after an index of food prices surged to a 10-week high.
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