India FMCG market set for further growth

26 October 2009

NEW DELHI: The FMCG sector in India could enjoy growth of up to 20% in the next quarter, a new forecast from the Associated Chambers of Commerce and Industry of India predicts.

Estimates from ASSOCHAM suggest the fast-moving consumer goods category is worth $14.7 billion (€9.8bn; £9.0bn) in the Asian nation at present, a figure that is likely to more than double, to $30bn, by 2012.

Despite having recorded a drop in net profits of 2.7% year-on-year in the last quarter, Hindustan Unilever is expected to see sales levels improve by 9.2% over the subsequent reporting period, with profits rising 7%.

Dabur's income will increase by 17%, with sales up by 25%, in the same timeframe, while Colgate Palmolive will post a similar leap in profits, as sales surge by 45%.

Marico is set to see volumes climb by 17.5%, and net income by 63%, with Nestlé up by 21% and 35% on these measures respectively.

Overall, the personal and fabric washing market will expand by 14.2%, with oral care up by 11.5%, skincare and cosmetics by 12%, and haircare by 16%.

The food and beverage market, one of the biggest segments in the consumer packaged goods industry, will register an even more substantial uptick, of 19%.

ASSOCHAM also reports that Hindustan Unilever currently generates around half of its sales from rural areas, as does Dabur.

This figure falls to 37% for Colgate Palmolive and Marico, and 25% for GlaxoSmithKline's consumer arm and Nestlé.

As previously reported, it is thought these less urbanised regions of the country will be among the key drivers of the FMCG market's expansion in the long term.

Data sourced from ASSOCHAM; additional content by Warc staff