 "FMCG")
Sales of fast-moving consumer goods (FMCG) saw an uptick in October as kiranas, or mom-and-pop stores, stocked up ahead of Diwali, according to the data by retail intelligence firm Bizom.
Rural growth, which had been muted until recently, witnessed a strong revival last month.
“There was a strong double-digit growth in rural sales across FMCG categories excluding branded commodities. This was driven by high growth in confectionery, beverage, and packaged foods as gift packs saw greater traction,” Akshay D’Souza, chief of growth and insights at Bizom, told Business Standard.
Excluding branded commodities, sales of FMCG grew 7 per cent in value terms in October compared to the same month last year. However, inclusive of branded commodities, the sales were down by 4.8 per cent.
Sales of consumer goods (without considering branded commodities) in urban areas grew by 1.6 per cent. In rural areas, the sales witnessed a sharp increase of 10.2 per cent.
“We also see that there has been an impact of the year-on-year (Y-o-Y) price drop across edible oils, affecting revenues from branded commodities. This is weighing heavily on the overall FMCG (value) growth,” D’Souza said.
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Commodity sales were down 27 per cent in October compared to the year-ago period, while confectionery saw the highest Y-o-Y sales growth of over 27 per cent as mom-and-pop stores stocked up on these items ahead of the Diwali.
Beverage sales also witnessed an uptick and were up 16.3 per cent. However, sales of items ranging from shampoos to moisturisers continued to remain under stress as consumers remained tight-fisted. Personal care sales were down 3.8 per cent Y-o-Y in October.
“It’s clear that this year too we continue to see a fight for retail shelf space during Diwali. We will need to wait and see offtakes in order to determine real consumption. That will get clearer in the next month as we track new stocking into stores,” D’Souza said.
NIQ, formerly known as NielsenIQ, recently noted that the FMCG industry witnessed robust growth in the July-September quarter as rural markets continued to recover amid easing inflation.
The FMCG industry clocked a 9 per cent Y-o-Y growth in terms of value in Q2FY24, while sales volumes rose 8.6 per cent in this period, indicating positive consumption patterns at all-India level. Volumes in rural markets grew 6.4 per cent Y-o-Y in the quarter, NIQ said.
Rural markets are showing “signs of recovery”, with consumption picking up during the September quarter compared to the year-ago period. Urban markets, on the other hand, are maintaining “a stable rate of consumption growth”, NIQ noted in its report.
