Investment Rating - The industry view is rated as In-Line [14] Core Insights - In May, the consumer sector underperformed the Sensex after two consecutive months of outperformance, with approximately 60% of the stocks under coverage underperforming [2][3] - Food & Beverages (F&B) stocks were the worst performers, particularly Varun Beverages and Tata Consumer, while Discretionary & Retail stocks saw some outperformance led by IGI (India) and Trent [2][5] - Over the past 12 months, only Discretionary & Retail stocks outperformed the Sensex, with Jubilant and Nykaa being the best performers, while paint stocks, led by Asian Paints, underperformed the most [3][5] Summary by Category Consumer Sector Performance - The consumer sector saw a valuation de-rating relative to their 5-year average multiples, with exceptions like Jubilant, ITC, Marico, and GCPL experiencing re-rating [1][4] - Majority of stocks are trading below their 200-day moving average (DMA), while most are above their 50-DMA, except for Varun Beverages, ABFRL, Asian Paints, Jubilant, Avenue Supermarts, and ITC [3][19] Stock Ratings and Consensus - Recent consensus rating downgrades were most notable for Vedant Fashion, Dabur, Asian Paints, and Avenue Supermarts, while Page and Titan saw upgrades [5] - Key consensus buy ideas include ITC, Varun Beverages, GCPL, Marico, and Trent, while Asian Paints, Berger, Avenue Supermarts, and ABFRL are key sell ideas [5][20] Earnings Estimates - Downward revisions to consensus earnings estimates for F26 and F27 have continued for most companies, with Berger, Page, and Britannia being the only stocks to see positive upward revisions [6][22] - Changes to consensus earnings estimates show a decline for most companies, particularly in the Paints and F&B sectors [22] Valuation Trends - Paint stocks, Trent, Avenue Supermarts, Dabur, and HUL have seen the most de-rating compared to their five-year trailing average valuation multiples [4] - Current P/E multiples for various sectors indicate a significant range, with Paints at 42.5x and F&B at 55.7x, reflecting a premium over their historical averages [15][24]