New Delhi, July 9 -- Amidst a backdrop of sluggish demand, margin pressures, and heightened competition in the consumer sector, Jefferies has highlighted early signs of improvement in certain areas. The brokerage observed that while some issues such as competition may linger, factors like demand recovery and margin stabilisation offer scope for optimism.

In its latest note, Jefferies identified Varun Beverages, Hindustan Unilever, and Asian Paints as top contrarian ideas for the next 12 months, citing a favourable risk-reward profile despite persistent challenges in the broader space.

Jefferies noted that several consumer-facing firms have been weighed down over the past few quarters by slowing growth, intense competition, and shrinking...