- Inflation is at a record high in NZ
- The annual rate is 6.9%, as per the data released by StatsNZ today
- The RBNZ will raise the OCR again in May to cool off inflationary pressure
Today, Stats NZ released its consumer price index (CPI), which was the highest in three decades at 6.9% for the whole year.
Even the quarterly Household Living-cost Price Index (HLPI) showed that the cost of living had gone up substantially for Kiwis. It said that the annual cost of living was the highest since the 1990s for an average household.
Against this background, the Reserve Bank in its meeting next month is set to raise interest rates and tighten the monetary policy.
Against this backdrop, let’s look at these 2 NZX-listed consumer stocks.
Seeka Limited (NZX:SEK)
SEK is a horticulture company that reported an NPAT increase of 44% in FY21 due to its business strategy. Its revenue was up by 23% to NZ$310 and EBITDA grew by 32% to NZ$56.8 million. SEK has also been able to improve its regional service through major kiwifruit acquisitions. In 2021, it acquired three regional companies and in 2022 beginning, SEK acquired NZ Fruits Limited. These acquisitions are expected to increase its marketshare to 26% of the NZ kiwifruit market.
On 22 April, the stock was trading down NZ$5.15, at the time of writing.
Scales Corporation Limited (NZX:SCL)
SCL is a diversified company that operates across many countries. It has reported a robust financial performance with a revenue of NZ$514.6 million, up 9% on pcp. The NPAT was NZ$36.9 million, up 39% over pcp. The underlying EBITDA was up 15% to NZ$73.8 million. The Company delivered strong results in all its divisions, including Horticulture, Food Ingredients and Logistics.
The Food Ingredients division was the best performing division with outstanding results, supported by demand for pet food.
Also Read: A look at top 15 stocks on NZX for the day
On 22 April, the stock was trading down by 041% at NZ$4.89, at the time of writing.
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Bottom line: With inflation touching 6.9% and food inflation going even higher, how will consumer companies fare amid rising inflation and subsequent rate hikes by the RBNZ, is yet to be seen.