FMCG in A Slump; But Revival on the Cards

Meanwhile, with the market size of over $13.1 billion, FMCG sector is the fourth-largest sector in India. In fact by 2-15, it is expected to reach $33.4 billion. According to the study conducted by Nielsen India, the total sale of companies like HUL, Dabur, Godrej Consumers, Emami, Marico, GSK Consumer, Nestle India, ITC and Colgate India grew by 13 percent.

There is no doubt that FMCG sectors are more recession-proof than other sectors like autos and consumer durables. To increase their sales, these FMCG firms can come up with strategies like repackaging their products and make them affordable for all budgets. “Revenue from smaller packs contributes 60-65 per cent of annual revenue,” says Pravin Kulkarni, General Manager (marketing), Parle, which sells popular biscuit brand Krackjack.

P&G and HUL are some of the companies that was badly hit by the weak rupee, which had a record loss before tax of `371.17 crore last fiscal. “In the period, especially in the second half of the year, we saw unprecedented devaluation. We still have import reliance on our products and due to high devaluation, we saw a sudden increase in cost of goods sold,” explains Tapan Buch, CFO, P&G India, which sells Tide detergent, Pantene shampoo and Olay skincare range.

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