FMCG Sector Rebounds With 10.6% Growth In December Quarter

(MENAFN- KNN India) New Delhi, Feb 7 (KNN) In a significant turnaround, India's fast-moving consumer goods (FMCG) sector posted a robust double-digit growth of 10.6 per cent in the December quarter, marking its highest performance in a year.

This surge comes after a 6.5 per cent growth in the same period last year and a steady improvement from 5.6 per cent in the September quarter and 3.5 per cent in the June quarter.

According to NielsenIQ India's latest FMCG quarter snapshot, this growth was primarily fueled by a sequential recovery in rural markets, strong festival demand, and higher prices of staple goods such as edible oil, palm oil, and packaged atta.

Volume growth was equally impressive, rising by 7.1 per cent despite a 3.3 per cent increase in prices. Interestingly, a notable shift in consumer behaviour emerged, with smaller pack sizes gaining popularity.“A higher unit growth than volume growth indicates a preference shift towards smaller packs in consumers,” the report noted.

Rural markets continued to outpace urban areas, with rural volume growth surging to 9.9 per cent from 5.7 per cent in the previous quarter, while urban volume growth rose to 5 per cent from 2.6 per cent.“India's FMCG sector is poised for robust growth, with rural markets continuing to lead the charge, outpacing urban consumption.

For the first time in four quarters, we have observed a combination of consumption and pricing driving overall FMCG growth,” said Roosevelt Dsouza, head of customer success, FMCG at NielsenIQ India.

Food volumes saw a remarkable 7 per cent increase, up from 3.4 per cent in Q3, while home and personal care (HPC) volumes grew to 7.3 per cent from 5.4 per cent.

Over-the-counter healthcare products, including rubefacients and analgesics, recorded a 13 per cent rise in value sales, supported by a 10.6 per cent price increase.

Smaller manufacturers emerged as key growth drivers, consistently outpacing larger players in both food and HPC categories.“Small manufacturers are outpacing larger players in driving consumption, fuelled by consistent volume growth.

While the giants are seeing slower value growth, they are still growing at twice the rate compared to Q3'24,” the report highlighted.

Meanwhile, kirana stores saw an 8.1 per cent volume growth in Q4, up from 3.9 per cent a year ago. However, modern trade volumes declined by 1.1 per cent, a stark contrast to the 20.2 per cent growth recorded in the same period last year.

As the FMCG sector continues to ride this wave of growth, industry experts are optimistic about sustained momentum, particularly with rural markets leading the way.

(KNN Bureau)

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