Amber Enterprises, Coal India, and Varun Beverages Lead Market Gains on Strong Summer Sales Expectations
Shares of consumer durable manufacturers, beverage companies, and power producers surged on March 6 following heatwave warnings from the India Meteorological Department (IMD). The IMD forecasted above-normal temperatures across India starting in March, with an increased likelihood of heatwave days between March and May.
This weather-driven market rally saw notable gains in companies catering to summer demand, including air conditioner (AC) manufacturers, beverage makers, and power suppliers. Investors anticipate a significant rise in consumer spending on cooling solutions and energy consumption, driving stock prices higher across these sectors.
Consumer Durable Stocks Surge Amid Rising Demand for Cooling Products
As India braces for record-high summer temperatures, shares of air conditioner, refrigerator, and inverter manufacturers saw strong buying interest. The increased demand for cooling appliances led to an uptick in share prices for several companies.
Amber Enterprises, a leading air conditioning and cooling solutions provider, recorded the largest jump, surging over 9% to an intraday high of ₹6,350 per share. The company specializes in manufacturing Room Air Conditioning (RAC) solutions and printed circuit boards (PCBs), making it well-positioned to benefit from surging AC sales during peak summer months.
Whirlpool of India, a major producer of refrigerators, air conditioners, and washing machines, saw its stock price rise by nearly 3%, reaching ₹986 per share. With higher consumer demand for refrigerators amid heatwaves, the company is expected to see strong summer sales.
Voltas, one of India’s top air conditioning brands, also recorded gains of nearly 2%, trading at ₹1,411.50 per share. The company has consistently maintained a strong market presence, benefiting from India’s growing demand for energy-efficient cooling solutions.
V-Guard Industries, which manufactures inverters and voltage stabilizers, gained 2% to trade at ₹329 per share. As electricity consumption rises, power backup solutions are expected to see higher demand, boosting V-Guard’s growth prospects.
Nifty Consumer Durables Index Gains as Cooling Product Stocks Rally
The rise in summer-related stocks pushed the Nifty Consumer Durables Index into positive territory, reflecting increased investor confidence in companies supplying air conditioners, refrigerators, inverters, and other cooling appliances.
Beverage Stocks See Gains as Demand for Cold Drinks Rises
The soaring temperatures are expected to drive higher soft drink and bottled water sales, benefiting companies in the beverage sector.
Varun Beverages, a key PepsiCo bottling partner in India, saw its shares climb nearly 3% to ₹489.60 per share. Despite the gains, the stock remains close to its 52-week low of ₹419.55, recorded earlier this month.
Global brokerage firm Jefferies maintained a “Buy” rating on Varun Beverages, setting a target price of ₹715 per share, citing strong growth potential amid rising soft drink consumption.
Power Sector Stocks Surge as Electricity Demand Expected to Soar
With rising temperatures comes increased power consumption, driving demand for electricity and coal-based energy production. As a result, power sector stocks saw notable gains on March 6.
Coal India, the country’s largest coal producer, surged 4% to ₹383 per share. The stock has been recovering from a 52-week low of ₹349, which it touched on February 17. Analysts at ICICI Securities retained a ‘Buy’ call on Coal India, setting a target price of ₹440 per share, citing higher demand for coal-based power generation.
NTPC, India’s largest state-run power company, saw its stock rise over 2% to ₹334 per share. The stock has rebounded from its 52-week low of ₹293, also recorded on February 17.
Nifty Energy Index Rises on Power Stock Gains
The rally in energy stocks pushed the Nifty Energy Index up nearly 2%, hovering around 31,711. Investors expect higher electricity demand to drive revenue growth for thermal power plants, coal producers, and renewable energy companies.
IMD Forecasts Extreme Heat, Raises Concerns Over Infrastructure and Public Health
On February 28, the IMD issued an official warning, predicting above-normal maximum and minimum temperatures across most parts of India during March, except for certain isolated regions. The forecast also warned of increased frequency and intensity of heatwave days, posing significant risks to public health and infrastructure.
In an official statement, the IMD advised Indian citizens to take precautions, stating:
“Heatwaves pose significant risks to vulnerable populations, including the elderly, children, and those with pre-existing health conditions, leading to heatstroke, dehydration, and strain on infrastructure… Citizens are strongly encouraged to utilize these resources to proactively take personal precautions, such as staying hydrated, avoiding peak sun hours, and seeking cool environments.”
Government and Economic Response to Climate Change Challenges
The rising temperatures and extreme climate conditions are expected to have economic and infrastructural impacts. Following the Q3FY25 GDP data release, Chief Economic Advisor V. Anantha Nageswaran addressed concerns over the economic effects of an unusually warm February, stating that the government is taking multiple measures to combat climate change and global warming.
While extreme heat is expected to boost sales of cooling appliances, beverages, and energy, concerns remain about strain on power grids, rising electricity costs, and the potential impact on agricultural output.
Market Outlook: Rising Heat May Continue to Influence Stock Movements
With higher summer temperatures on the horizon, the market expects further gains in consumer durable stocks, beverage companies, and power sector stocks. Investors will closely watch temperature trends, electricity consumption data, and sales figures from consumer-focused companies to gauge how the heatwave impacts corporate earnings and market sentiment.
As demand for cooling solutions, power, and soft drinks rises, analysts predict that summer-related stocks will continue to gain momentum in the coming months, making them key investment themes in India’s stock market.
