Value growth for the Indian fast-moving consumer goods (FMCG) sector stood at 4 per cent in the April-June quarter, driven by relaxed consumption patterns, while volume growth was recorded at 3.8 per cent, according to consumer research firm NielsenIQ.
Price growth stabilised during the quarter at 0.2 per cent, indicating a stable market environment.
Rural volume growth in the quarter stood at 5.2 per cent, while urban growth was at 2.8 per cent. Both experienced softer consumption in the quarter ended June, the research firm noted.
In the January-March quarter, rural volume growth was higher at 7.6 per cent, while urban volume growth was at 5.7 per cent.
“The Indian FMCG industry growth has been steady, reflecting its resilience and adaptability. The sector experienced a 4 per cent value growth in Q2 2024 (April-June), attributed to relaxed consumption patterns. This deceleration in volumes is largely due to macroeconomic headwinds. While rural volume growth at 5.2 per cent continues to outpace the 2.8 per cent growth in urban areas, both regions experienced softer consumption this quarter,” Roosevelt Dsouza, head of customer success – India at NielsenIQ, was quoted as saying in its release.
FMCG consumption growth has been primarily impacted by the food sector, with growth at 2.4 per cent in the April-June quarter compared to 4.8 per cent in January-March. NielsenIQ noted that the moderation in volume growth is attributed to the staples categories, including packaged salt, packaged atta (wheat flour), and palm oil.
In non-food categories, volume growth stood at 7.6 per cent in the quarter ended June, compared to 11.1 per cent in the quarter ended March.
“This downtrend in consumer demand for personal care and home care categories is observed in both urban and rural markets. In urban areas, personal care categories are witnessing a volume growth of 5.2 per cent in April-June (compared to 9.7 per cent in January-March), while in rural areas, growth is at 8.3 per cent in April-June (compared to 10.6 per cent in January-March),” NielsenIQ’s release said.
It also noted that in rural areas, high-contributing categories like laundry and utensil cleaners within homeware witnessed slow consumption.
Summer-specific categories such as soft drinks, packaged drinking water, prickly heat powder, and glucose powder saw a sharp uptick in the quarter. Soft drinks grew two times faster than the overall FMCG sector but experienced some moderation sequentially in the April-June quarter.
“Within the broader FMCG industry, large players continue to demonstrate stronger performance compared to small and mid-sized players. Small players face challenges in keeping prices stable, which in turn impacts their volumes,” NielsenIQ said.
First Published: Aug 08 2024 | 12:29 PM IST