Grupo Modelo SAB (GMODELOC), the brewer of Corona beer, had its biggest weekly gain since October as traders speculated that demand will remain intact even as Europe’s debt crisis curbs consumer spending.
Modelo closed at 93.41 pesos in Mexico City, an advance of 6 percent this week, its largest weekly increase since Oct. 28. The shares fell 0.9 percent today.
Investors are betting that consumers worldwide will keep buying beer even as concern that Greece will exit the euro has wiped about $4 trillion from global equity markets this month, said Ivo Kovachev, who helps oversee $1 billion including Modelo shares at JO Hambro Capital Management Ltd. in London.
“The whole sector, almost everywhere, has done well” because of the belief that beer consumption won’t slacken, he said in an e-mailed response to questions.
Modelo will also benefit from declines in the peso because of its strong export business, Kovachev said. The peso has fallen more than 7 percent against the dollar this month, the largest decline among major Latin American currencies tracked by Bloomberg.
Modelo’s sales rose 10.6 percent to 21.3 billion pesos ($1.52 billion) during the first quarter. Exports rose 3.2 percent to $626 million and accounted for 29 percent of the brewer’s volumes. Corona has been the top imported beer in the U.S. since 1997.
“The peso’s depreciation should help its second-quarter results,” Karla Miranda, an analyst at Grupo Bursatil Mexicano in Mexico City, said in an e-mailed statement.
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