However, rural demand continued to remain a concern for FMCG companies during the quarter.
Big, listed FMCG (fast-moving consumer goods) companies such as Hindustan Unilever, ITC, Nestl, and Britannia have been top-performing stocks on the bourses in recent weeks. The Nifty FMCG index, which tracks the share prices of the country's top 15 listed FMCG companies, is up 1.9 per cent month-to-date in May compared to a 2.4 per cent decline in the benchmark Nifty 50 in the period.
The 58-year-old go-to man at the consumer goods maker will helm Global Beverages & Foods that will launch confectioneries, juices and snacks in six-nine months.
The sharp jump in shares of Kalyan Jewellers (Kalyan) has surprised many on the Street; however, analysts believe more steam could be left in the stock as the Thrissur-based gold retailer pivots to a new asset-light network expansion model. Kalyan's stock has surged 62 per cent in the past month, even as the S&P BSE SmallCap Index has gained just 5 per cent. In its latest business update, the company said its consolidated sales grew more than consensus expectations at 31 per cent year-on-year, led by strong domestic sales regardless of the volatility in gold prices.
Most brokerages are betting that the new government will shift to a policy focussing on boosting rural incomes and consumption since that has clearly been a pain point.
The slowdown in private consumption in the economy is taking a toll on the growth of fast-moving consumer goods (FMCG). The net sales growth of listed FMCG companies hit a 14-quarter low of 2.5 per cent in October-December 2023 (Q3FY24). This is the lowest revenue growth for the industry since the June 2020 quarter, when the FMCG firms in the Business Standard sample had reported a 13.2 per cent Y-o-Y decline in combined net sales owing to the lockdown.
Vivek Gambhir revels in his two-city life between the Godrej-owned flagship in Mumbai and his own family in New Delhi.
With Onam and Raksha Bandhan just around the corner, the festival season is ready to kick off in full swing. As people embrace the celebratory spirit, companies anticipate a surge in sales this year. Consumer durables firms are expecting strong growth of 40-50 per cent in the premium segment during the upcoming season. Appliance makers also foresee increased demand for cooling appliances - refrigerators and air conditioners - which were impacted by unseasonal rainfall.
The company also believes the e-commerce facility would prove especially handy for the NRI consumers who would want to present gifts to their families back in India.
The biggest challenge is crude oil's sustained rally - it is nearing $80 a barrel - stoking inflationary pressures and consequent price hikes in the sector.
Companies manufacturing fast-moving consumer goods (FMCG) continue to see rural stress sustain and it continues to trail urban demand. At the Confederation of Indian Industry's FMCG summit, managements of various companies pointed out urban demand continued to grow while rural demand remained under pressure because incomes were under stress in rural areas. "Due to rural stress, volumes continue to remain an issue for the industry and we are yet to see any revival in demand," Sudhir Sitapati, managing director (MD) and chief executive officer (CEO) at Godrej Consumer Products
Fast moving consumer goods (FMCG) companies are expected to see muted topline growth, with uneven spread of the monsoon impacting demand. Rural demand recovery, too, remains elusive in the July-September quarter. Brokerages expect volumes to remain steady in the quarter on a sequential basis.
Hindustan Unilever (HUL), one of the country's largest fast-moving consumer goods (FMCG) players, is learnt to have cut prices of its leading soaps and detergents this month by 2-19 per cent, according to the company's distributors. The cuts come after consistent price increases by the company as well as its peers, following the sharp rise in raw material prices in the past several months. It is only recently that prices of raw materials have started to correct from peak levels in the June quarter.
The slowdown is behind us and the country will grow at around 9-10 per cent, believes Adi Godrej, chairman of the Godrej Group.
'She adds value to life in many commendable ways. Apart from her many contributions to our consumer products business and Godrej Properties, she dedicates her energies and resources to charity, to philanthropic causes and most of all how she has managed her time as a wife, mother and entrepreneur brilliantly,' says Adi Godrej.
As record stock market rally continues, the value of shares directly owned by next-generation business leaders at 20 major corporate houses has soared over 18 per cent to Rs 17,000 crore.
Since 2008, the Bureau of Energy Efficiency is running a star rating programme, under which electric equipment are rated according to their efficiency. This in turn helps the consumers save electricity.
The report analysed product launches of 2011, their success over three years, and reported 31 of the 14,509 products introduced that year were received well by consumers.
'An in-house contest encourages employees to share yoga and well-being practices with their families.'
Godrej-GE Appliances which sold a faulty refrigerator has been held guilty of deficiency in service by a Delhi consumer court.
Investment push by the Modi govt and draw-down of UPA's welfare schemes to put pressure on demand.
Consumer goods firms and auto companies are witnessing an upturn in rural demand, which had been lagging for most of FY24. Expectations of a bumper rabi crop harvest have helped turn the tide. The Reserve Bank of India's (RBI's) Monetary Policy Committee kept the repo rate unchanged last week, noting that as rural demand catches up, consumption is expected to support economic growth in 2024-25.
Consumer durables major Godrej & Boyce plans to enter the television segment in 2008.
Brands in FMCG sector have taken to brand valuation to identify the potential and realised value of the brand names.
Amway surged by converting a multitude into sales agents.
Stocks of alcoholic beverage makers have corrected over the last few trading sessions on worries that taxes, competition and costs will hurt sales and profitability. The recent trigger for the decline is Karnataka, which accounts for 15 per cent of overall liquor consumption, increasing duties. The state increased by 20 per cent the additional excise duty on Indian-made foreign liquor (IMFL) on all slabs.
"Both domestic and international business grew well this quarter. Growth in net sales of the domestic business was close to 50 per cent, while the international business saw nearly a three-fold growth during the same period. Our international acquisitions have played a role in helping us register good numbers this quarter."
An industrial house bred in old-school manufacturing values, Godrej & Boyce has displayed unusual agility to become a trusted builder of advanced weaponry, discovers Ajai Shukla.
Godrej Industries Ltd's foods division, the manufacturer of Sofit Soymilk, along with the Indian Medical Association and the American Soybean Association, conducted a seminar on the health benefits of soy titled 'Soy Milk Nutritional Health'.
These stocks offer the best combination of maximum 'buy' recommendations from brokerages and share price upside over the next 12 months.
Enthused by robust financial performance and attractive valuations, foreign investors increased their exposure to fast-moving consumer goods (FMCG) companies such as Britannia, Hindustan Unilever and Godrej Consumers Products in April-June this year.
'Due to rural stress, volumes continue to remain an issue for the industry, and we are yet to see any revival in demand.'
The company is also looking at a turnover of Rs 4,500 crore this financial year, of which the appliances division is expected to contribute close to Rs 1,400 crore.
Consumer durables retailers and manufacturers may end up bearing the cost of the Reserve Bank of India's (RBI's) tightening on easy personal loans, as their margins are expected to be impacted by higher borrowing costs. During the recently passed festival season, consumer durables companies started offering longer tenure loans, zero down payments, and zero interest on a wider assortment of products than ever before, making the products more affordable. While 18- and 24-month easy monthly instalment (EMI) options were available earlier, companies offered them only on select products; now, they are being extended to a larger section of products.
PI Industries, GCPL, Colgate and HUL have delivered positive returns every year since 2008.
Companies whose products have not been picked up for distribution in Gujarat under a "non-cooperation movement" include Marico, Dabur, Emami, Britannia, Reckitt Benckiser, and Godrej Consumer Products.
Even as large fast moving consumer goods companies like Hindustan Unilever and ITC struggle with their volume growth, mid-tier FMCG companies like Godrej Consumer Products, Marico, Dabur and Nestle have reported strong spurts in volumes as they focus on inorganic growth and rural markets, according to industry experts.
For the quarter ended June, most FMCG companies reported growth of 15-20 per cent in revenue, as demand for daily-use items continued to be high.
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