Food Inflation and Rural demand
There is a co-relation between food inflation and parameters like cigarette volume, staples, 2-wheelers/PV sales and NPA cycle of rural NBFCs.
There exists a positive co-relation between food inflation and wage growth, which means rural wages are likely go up with food prices inducing rural demand.
Similarly, food inflation has strong positive co-relation with cigarette volume growth, HUL top-line growth, 2-wheelers sales growth and moderate negative co-relation with Maruti Suzuki top-line growth.
Food inflation has a negative co-relation with Mahindra Finance’s GNPA cycle, indicating thatas food inflation goes up, GNPA comes down and vice versa' -