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Resource centre on India's rural distress
 
 

FMCG companies red-flag gathering rural slowdown -Pranav Mukul & Anil Sasi

-The Indian Express

There is an emerging consensus among FMCG majors that, like their automobile counterparts, the impact of the slump is more evident in rural India and that, in geographical terms, the north is the worst hit.

New Delhi:
The impact of the deepening consumption slowdown is being felt beyond discretionary purchases such as vehicles and durables with fast-moving consumer goods (FMCG) companies manufacturing small-ticket items such as soaps, biscuits and other daily essentials reporting a steady slide in consumer sentiment.

There is an emerging consensus among FMCG majors that, like their automobile counterparts, the impact of the slump is more evident in rural India and that, in geographical terms, the north is the worst hit.

The volume growth, or the increase in number of units sold, of FMCG companies has slowed down perceptibly over the last one year and this trend is evident across companies.

For Hindustan Unilever Ltd, the country’s biggest FMCG company, there was a 7 percentage point dip in volume growth between the June quarter this year versus the same period last year. Britannia Industries, India’s second largest biscuit company, also recorded a 7 percentage point drop while for Dabur India, the slide in volume growth on a year-on-year basis during the April-June quarter was 15 percentage points.

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