FMCG firms see rural demand recovering this year as macroeconomic conditions improve
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Leading FMCG companies are betting on a gradual recovery in rural demand this year on the back of improving macroeconomic conditions, continued government spending and price cuts. Many companies said the industry continued to witness sluggish rural demand in the December quarter with the urban consumption continuing to outpace rural demand.

On the Q3 earnings call, Saugata Gupta, MD & CEO, Marico Ltd, said that FMCG volume growth on a four-year CAGR basis remained at low single-digits, with rural and mass categories “tracking lower” than urban and premium categories.

“So far, while the pace of recovery in consumption has not been on anticipated lines, we remain optimistic of a gradual uptick in consumption trends over the course of the next calendar year, in light of improving macroeconomic indicators, continued government spending, lower inflation and substantial cuts in consumer pricing implemented by large organised players in response to an accommodative and stable input cost environment,” he added.

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