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Finding stocks that thrive in summer months

The sun has started to blaze. As the summertime sets in, it’s a desperate search by many for the perfect…

By editor , in The Public Markets , at May 10, 2018

The sun has started to blaze. As the summertime sets in, it’s a desperate search by many for the perfect cooling solution or the long trip to some cooler locale. The generally desired summer solutions lead to brisk business by companies in the consumer durable space selling cooling appliances and travel related companies, perking up the stocks of the listed companies in these spaces. If you’re an equity investor, and you’re able to time it right, you could make a neat heap by investing in some summer demand related seasonal stocks that typically register an uptrend between the months of May and October.

Market experts feel that both consumer durables and tours and tourism businesses should do well this summer. With the expectation of a normal monsoon, the economics overall should grow at a healthful rate of 8-9%, which led to a significant increase in demand for services and products in these sectors. Nevertheless, one should assess the fundamental story behind the specific stocks prior to making the investments. Among consumer durables, stocks such as Whirlpool, Bajaj Electricals, Videocon, Volta and Blue Star, all of which sell cooling products like coolers and AC, are listed on the stock exchange. Air conditioning and colder certificates have about 30% weighting for white goods in the BSE Consumer Durables Index.

In general, a sustainable one is one that doesn’t wear soon, or that yields utility with time as opposed to being completely consumed in one use. Consumer durables like refrigerators and air conditioners usually continue to be useful for 3 or more years at least. And on the other hand, travel related scrips like Cox and Kings, International Travel House, Thomas Cook, Trade Wings and Transcorp International are available for investing.

Many believe that the summer months can be quiet in the stock market. But if you are careful and calculated, you may come to find that there are stocks out there that are booming just because of the weather. So get creative and start hunting!