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Consumer goods stocks to buy: Long-term investing with a different perspective: Stocks of 5 companies with strong brands which have stood the test of time

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Consumer goods stocks to buy: Long-term investing with a different perspective: Stocks of 5 companies with strong brands which have stood the test of time

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Synopsis

In a particular sector, if only one or two companies are listed on the market, and the rest are unlisted players, it suggests one of two things. First: The overall size of the sector is not too big. Two: It is a largely unorganized sector. If it is the latter case, and the listed player has a strong brand, then the stock is worth looking at. There are examples of such stocks commanding a premium on the street and, over the long term, delivering returns as well. But do check whether the brand is at least two decades old. Why two decades? Because in the last two decades India Inc has seen the best of competition. If the company and its brand have been able to survive the competition, then they must be operationally efficient. And that is what matters in the long run.

Here’s a small test. How many brands of pressure cookers can you recall? One, maybe two? Does it mean there are only two companies making pressure cookers? The answer is clearly no. Similar is the case with water purification systems. You may again name one or two brands. Now let’s delve a little deeper into the water purification systems space. A few months back, a big FMCG company with the power of cash and a strong distribution system sold

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