Hemas Holdings PLC (Hemas) will reap large returns on their Fast Moving Consumer Goods (FMCG), leisure and power sectors this year, analysts said. “The FMCG sector during this year will see large volumes growth with improving economic growth and relatively high priced products coming into demand due to higher disposable income,” Deshan Pushparajah, Assistant Manager Corporate Finance, Capital Alliance told the Business Times.
The FMCG sector contributed 4% to the company’s growth during the last financial year, according to Hemas’ annual results.
Analysts said that in this sector margins have been relatively squeezed due to high competition as well as the slower economic growth seen over the last year.
Mr. Husein Esufally, Hemas’ CEO in the annual review, said that FMCG industry in the country grew by 9%, while most FMCG categories at Hemas saw a double digit growth aided by the opening up of the North/East markets.
Hemas saw a 30% hike in profits in the last financial year to Rs 935 million compared to the Rs 719 million recorded the year before. Mr. Pushparajah noted that Hemas’ results have mainly grown due to the reduction in cost of sales and reduction in finance costs.
“The leisure and travel sectors will also do very well this year. This is the year for tourism and it is expected that there will be a large growth in this area.”
He said that power sector profits will improve with the additional plants funded by the Hemas Power, which is a subsidiary of Hemas.