The rapid escalation in the Russia-Ukraine conflict has pushed commodity prices higher owing to supply disruptions. In an interview to CNBC-TV18, Shirish Pardeshi, FMCG analyst at Centrum spoke at length about the sector.

Talking about Asian Paints, he said, “The inflation which has happened, will definitely have a positive impact in Q4 (FY22) earnings. However, crude which is more than USD 100 per barrel, we might see further inflation if the war (Russia-Ukraine) does not stop.”

Also Read: FMCG industry sees consumption decline of 2.6% amid price hikes, rural markets most impacted

On fuel inflation, Pardeshi said, “The fuel inflation is also hitting; it’s indirect inflation which is hitting on the transportation cost, but we are also ignoring at this point of time the media inflation which is running ahead of 12-13 percent and looking at the past 3 quarters, most of the companies have cut ad spends and that emanation is still available for the company. However, the price increases which has gone into the trade will also have the impact but if further inflation which happens, most of the companies will take hit on margin.”

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Also, watch the accompanying video of CNBC-TV18’s Mangalam Maloo on how does this impacts FMCG companies and their business.

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