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Business News/ Industry / Retail/  FMCG sector’s value growth pegged at 37% in June quarter
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FMCG sector’s value growth pegged at 37% in June quarter

The second wave of covid didn’t dent the sector’s growth momentum, says Nielsen
  • Compared to the first round of pandemic-induced lockdowns, demand normalized as consumers went easy on pantry-loading
  • Traditional trade channels like grocers and chemists remained resilient, while sales via online retailers surged with e-commerce clocking a record high growth in the second quarter of the current fiscal.Premium
    Traditional trade channels like grocers and chemists remained resilient, while sales via online retailers surged with e-commerce clocking a record high growth in the second quarter of the current fiscal.

    NEW DELHI : ndia’s fast-moving consumer goods (FMCG) market grew 37% in the June quarter in value terms, albeit from a low base a year ago, market research firm Nielsen said on Thursday. However, growth dropped 2% sequentially as the pandemic’s second wave prompted statewide lockdowns. The growth momentum in India’s FMCG industry that was building up in the preceding quarters did not see any major setback with the sudden onset of the second wave, it said.

    Firms sold soaps, staples, toothpaste and ketchup as supply chains remained intact and stocks reached stores. Compared to the first round of lockdowns, demand normalized as consumers went easy on pantry-loading.

    Of the 36.9% growth (including e-commerce) reported by the sector the June quarter, FMCG volumes made up 18.2%. In the year ago quarter, value growth for the FMCG sector was down 17.9%— largely dragged by the lockdowns in April and May.

    “If we go by just the average number of closure days for retail shops, wave two was less severe than wave one of the pandemic. The lockdowns were decentralized and partial in nature, which allowed for greater accessibility for consumers. This led to consumers avoiding panic buying and it ensured lesser disruption in the supply chain," said Diptanshu Ray, NielsenIQ South Asia lead.

    India’s FMCG sector has weathered a tough year amid muted out-of-home consumption and intermittent lockdowns that impacted the availability of goods. Demand also shifted to more hygiene products, snacks and wellness products. Nielsen did not share its full-year estimates for the sector. It follows a calendar year.

    It also helps that demand rebounded faster in the aftermath of the second wave with several firms reporting an uptick in goods in June. “In fact, when indexed to pre-covid times (Q1’20) the industry largely continued to remain at similar levels," Nielsen said in its report.

    Several large packaged goods firms reported similar trends during Q1. Domestic volumes at Marico Ltd grew 21% in the June quarter, albeit on a soft base of the year-ago period when volumes dropped 14%. Dabur India reported a 32% growth in consolidated revenue from operations for the three months ended 30 June.

     

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    ABOUT THE AUTHOR
    Suneera Tandon
    Suneera Tandon is a New Delhi based reporter covering consumer goods for Mint. Suneera reports on fast moving consumer goods makers, retailers as well as other consumer-facing businesses such as restaurants and malls. She is deeply interested in what consumers across urban and rural India buy, wear and eat. Suneera holds a masters degree in English Literature from the University of Delhi.
    Catch all the Industry News, Banking News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
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    Published: 12 Aug 2021, 07:37 PM IST
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