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India's FMCG industry slows on dull rural, non-food demand

February 06, 2023 00:00:00


CHENNAI, Feb 4 (Reuters): Growth in India's fast-moving consumer goods (FMCG) industry slowed in the last three months of 2022 from the previous quarter as rural shoppers spent less on washing powder and shampoo, market intelligence firm NielsenIQ said on Thursday.

FMCG companies - particularly those who make personal care products - have struggled to pull in sales from cash-strapped rural consumers, worst affected by the COVID-19 pandemic and Russia-Ukraine war-led inflation.

India's FMCG industry grew 7.6 per cent in October-December after a 9.2 per cent rise in the previous three months, though consumption declined in the south and west, NielsenIQ said.

"Over the last year, consumer spending was impacted primarily because of inflation, echoed by consumers in the shift to smaller packs, and by manufacturers via grammage reduction," Satish Pillai, managing director of NielsenIQ in India, said in a statement.

Consumption of non-food items including washing powder, detergent bars and toilet soaps declined across consumer groups, with manufacturers offering lower discounts, according to NielsenIQ.

Still, consumers in urban areas bought more, with big-format supermarkets and hypermarkets growing in double digits for the second straight quarter.

Prices of products rose an average of 7.9 per cent in October-December, marking the first single-digit growth after six quarters. It recorded growth of 9.9 per cent to about 13 per cent during the period.


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