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<\/p>\nSales of fast-moving consumer goods (FMCG) witnessed significant recovery in September after enduring a double-digit decline in August, according to data furnished by Bizom.<\/p>\n
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Kirana stores in rural areas stocked up in preparation for the festival season, which began in September.<\/p>\n
This, combined with rainfall reaching 113 per cent of the long-perid average for the month, contributed to a boost in sales.<\/p>\n
In September, FMCG sales increased by 4.9 per cent compared to the previous year.<\/p>\n
This growth was primarily driven by rural sales, which saw a 5.8 per cent increase year-on-year (Y-o-Y), while urban sales also grew by 3.2 per cent during the same period.<\/p>\n
However, during the July-September quarter, sales of FMCG items were impacted, experiencing a 2.3 per cent Y-o-Y decline.<\/p>\n
This decline was primarily attributed to reduced sales of beverages and commodities, with the most pronounced effect seen in August and September.<\/p>\n
In the quarter ending in September, rural demand witnessed a steeper decline of 3.1 per cent, whereas urban sales saw a slight dip of 0.6 per cent.<\/p>\n
“We have observed a recovery in seasonal rainfall and a normal monsoon for the season (June-September), which has certainly had a positive impact on rural growth,” observed Akshay D’Souza, chief of growth and insights at Bizom.<\/p>\n
He added that the quarterly sales growth has mainly been affected by lower sales of branded commodities and beverages.<\/p>\n
Among branded commodities, the retail intelligence firm noted a sharp on-year drop in prices, including edible oils. Beverage sales were affected by the rains, which resulted in cooler temperatures.<\/p>\n
“However, homecare products have seen an increase in sales due to increased availability, whereas confectionery and packaged food products have seen heavier stocking, shoring up sales,” D’Souza said.<\/p>\n
He further said, “As we approach Diwali (in November), we anticipate FMCG companies to increase their stocking in kirana stores further this month (in October).<\/p>\n
“This is mainly aimed at expanding their market share as they seek to capture a larger portion of the heightened demand during Diwali.”<\/p>\n
Consumer goods companies also reported in their July-September quarterly updates that demand is gradually recovering.<\/p>\n
Dabur India, in its pre-quarterly results update, stated, “While FMCG consumption is showing Y-o-Y improvement, the recovery has been gradual.<\/p>\n
“The quarter witnessed a mild summer and a slightly deficient monsoon.”<\/p>\n
The ayurveda major also mentioned that this year, the festival season is later than usual, causing festival-related sales to be delayed and carried forward into the next quarter.<\/p>\n
Marico, in its pre-quarter results update, said that demand trends largely mirrored those observed in the preceding quarter.<\/p>\n
It said, “Instances of rising food prices and below-normal rainfall distribution in some regions seemed to impede the anticipated recovery in rural demand.”<\/p>\n