Rural-focused FMCG firms in sweet spot

Higher disposable income, price cuts to aid volume growth; Unilever, Dabur, Colgate, Emami among those to benefit more

Led by higher demand from rural markets, fast- moving consumer goods (FMCG) companies are expected to continue clocking double-digit growth in sales in the coming quarters. Rural sales of FMCG products rose 13 per cent year-on-year in the September quarter; urban sales grew only four per cent.
 
Overall volume growth for most FMCG companies have been in mid-single digit with Godrej Consumer and Emami clocking 9-10 per cent and a few (ITC, Colgate) seeing a fall in sales. Vikrant Oak and Sunil Jain of Quant Capital say rural demand had outpaced urban demand in the quarter on the back