May 7, 2019

FMCG growth slowdown in March quarter isn’t a temporary blip

India’s famous consumption story is going awry. At least that’s what March quarter results of some large fast-moving consumer goods (FMCG) companies show. Volume growth numbers fell substantially for these companies, with Godrej Consumer Products Ltd (GCPL) reporting a mere 1% growth in the domestic branded business volumes. A bigger worry was the low-spirited management commentary, which suggests that the worst is far from over.

“When a generally measured management like Hindustan Unilever’s uses the term ‘recession’ in its comments in the post-results presser, it generally isn’t a one-quarter blip," pointed out analysts from Kotak Institutional Equities in a report on 4 May. On Friday, HUL’s management had said, “While FMCG is recession resistant, it is not recession proof."

Management commentary from GCPL and Dabur India Ltd wasn’t inspiring either. These two companies harped ...


No comments:

Post a Comment

Share this...