Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Companies / News/  Hair oil to motorcycle sales highlight more growth pain ahead for India
BackBack

Hair oil to motorcycle sales highlight more growth pain ahead for India

Hero MotoCorp has shut a manufacturing facility for few days
  • Emami witnessing slowdown in demand for hair care products
  • Hero MotoCorp said it had shut its manufacturing facility for three days until 18 August in response partly to 'the market demand scenario'Premium
    Hero MotoCorp said it had shut its manufacturing facility for three days until 18 August in response partly to 'the market demand scenario'

    Indians are cutting back on spending from hair oils to motorcycles in a fresh sign that the slowdown in Asia’s third-largest economy is becoming more entrenched.

    That is likely to add pressure on policymakers to ease both fiscal and monetary policy in the coming months at a time when Finance Minister Nirmala Sitharaman tours the country to meet various stakeholders and lobby groups. The Reserve Bank of India has lowered interest rates to a nine-year low, but that impact is yet to be felt due to tardy monetary policy transmission and subdued demand for loans.

    On Friday, Hero MotoCorp Ltd., the country’s largest two-wheeler maker, said it had shut its manufacturing facility for three days until 18 August in response partly to “the market demand scenario" and inventory management. The same day, Sundaram-Clayton Ltd., an auto parts supplier, said it will shut its factory in Padi in the southern Indian state of Tamil Nadu for two days until 17 August, citing “business slowdown across sectors."

    Mirroring the sentiment about weak consumption, Emami Ltd., a cosmetics to healthcare conglomerate, said that the company was witnessing lower demand for its hair care products.

    “We are doing some cost optimization," Priti A. Sureka, a director at Emami said in an interview in Kolkata.

    Earlier this month, the company reported earnings that missed estimates as revenues took a hit, highlighting similar struggles among consumer good makers including Hindustan Unilever Ltd. and Britannia Industries Ltd. This does not bode well for India’s overall growth rate, which has been hit by slowing public spending and a cutback in private consumption.

    Official gross domestic numbers for the June quarter are due Aug. 30 and analysts forecast the economy to have expanded 6.1% from a year ago, which is higher than the five-year low of 5.8% seen in the January to March quarter, but well below the 7-8% pace seen in the past few years.

    A shadow-banking crisis for the past one year has weighed on private consumption which contributes nearly 60% to the GDP. The latest consumer sentiment survey from the central bank highlighted worries about job losses with a subdued economy keeping many from spending.

    Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

    This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.

    Catch all the Corporate news and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
    More Less
    Published: 16 Aug 2019, 11:23 PM IST
    Next Story footLogo
    Recommended For You
    Switch to the Mint app for fast and personalized news - Get App

    Chat with MintGenie