India’s Rural Markets

Major FMCG companies feel the demand slump has bottomed out and there are green shoots of recovery in the rural markets, which has been under stress since the last few quarters. With abating commodity price pressures, firms such as HUL, Godrej Consumer Products Ltd (GCPL), Dabur, Marico and Emami expect a gradual recovery in consumption going forward and are increasing upfront marketing investments in advertising and promotion (A&P). In the third quarter ended December 31, 2022, the companies reported growth in the urban markets. Modern trade channels and e-commerce also posted growth. But FMCG sales from traditional trade channels such as kirana stores were flat. Rural markets, which contribute around 35 per cent of FMCG industry sales, were still sluggish in Q3. However, the companies said they are witnessing signs of improvement on the back of encouraging winter crop sowing, indications of higher farm income and continued government stimulus. Home-grown firm Dabur said the ...

The Indian FMCG sector witnessed improvement in margins and slow growth in the December 2022 quarter but the rural markets continued to drag as retail inflation stayed at elevated levels, according to industry players. Godrej Consumer Products Ltd (GCPL) and Marico reported that although there is softness in demand, there has been an improvement partly due to the lingering effects of festive sales, while urban and premium categories maintained a steady pace during the October-December period. Godrej Consumer Products witnessed a "demand softness" in the domestic market and a slowdown post the festive season. "During the quarter, the Indian FMCG sector witnessed slow growth driven by poor rural consumption and a slowdown post the festive season," said the Godrej Group FMCG arm in its quarterly updates for Q3 FY23. Despite this, GCPL expects "double-digit sales growth backed by low single-digit volume growth". "The quality of our profits should see meaningful improvement, led by Gro

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Bizom pointed out that rural sales were impacted in September due to excessive rainfall in some areas and weak rainfall in some other regions, thereby affecting agri yields and household incomes

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Nearly 35 per cent of the FMCG sales come from rural areas and after the second wave, it was badly hit

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Emami is also progressing with its focussed rural expansion drive under 'Project Khoj' initially targeting top four potential rural contributing states -- Uttar Pradesh, Bihar, Maharashtra and Andhra

Faced with "unprecedented" inflation in certain commodities like palm oil, crude based derivatives and tea, and ocean freight, HUL has hiked prices in the past three quarters

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A resilient rural market is leading the recovery from the impact of the COVID-19 second wave, with the industry's business reaching March 2021 levels, FMCG major HUL said on Thursday

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The coronavirus pandemic-led economic shock just shrunk the lucrative middle class market by 32 million people, according to a recent report by the Pew Research Centre based on the World Bank data

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Private sector lender DCB Bank on Thursday said it is seeing a good business prospects from rural areas and wants to focus on "encouraging" tractor loans demand from the farming community. The bank is offering customised loans in Chhattisgarh, Karnataka, Andhra Pradesh, Telangana Madhya Pradesh, Maharashtra, Odisha and Rajasthan, which saw a growth in demand last year. The bank is positive about rural prospects, as evident from sales in Q2 FY21, and is expecting incremental growth in business, DCB Bank said in a release on Thursday. Citing a recent Crisil report that tractor sales were up by 12 per cent in first half of FY21, the lender said good monsoon and higher crop production generally support farm incomes and this in turn provides a fillip to tractor demand. Typically, fortunes of the tractor loan business depend on the vagaries of the weather and the harvest season among other macro and micro variables, it said. "The sale of tractors shows a heartening trend, it has posted

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