FMCG companies to face Q4 volume pressure amid sluggish rural demand

Analysts say rural demand stagnates while urban areas drive low to mid-single-digit volume growth, posing challenges for the sector

Fast-moving consumer goods (FMCG) companies anticipate sustained volume pressures in the January-March quarter (Q4) coupled with sluggish rural growth during the period. 

Brokerages estimate top-line growth to be in low single digits in the quarter. Also, the late onset of winter had an impact on demand for winter products which range from moisturisers to hot beverages. 

While brokerages expect no respite in rural sales, Dabur India said in its pre-quarterly update ahead of its Q4 results that it noticed a pick-up in rural growth fuelled by price rollbacks in staples which led to the gap between rural and urban narrowing.