FMCG sales set to see recovery in February, indicates data

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

After reporting sluggish sales in January as the third wave of the COVID-19 pandemic ravaged the country, FMCG companies are set to see a recovery in February, going by initial data trends. According to retail intelligence platform Bizom, in the first 15 days of February, FMCG companies clocked sales value growth of 0.7 percent over the same period in January. Active kirana stores, showed data, also registered a 4.2 percent growth in the said period as compared to initial 15 days of January.

If the trend holds, February is on track to be a better month for FMCG companies than January.

“Amidst the third wave of the pandemic, we are seeing definitive signs of FMCG sales rebound after just one month of impact. If the current sales growth trend continues till the end of February, we could see a mid to high single-digit growth in sales month-on-month for February 2022,” said Akshay D’Souza, chief growth and insights officer at Bizom.

According to the retail intelligence platform, the beverages category led the rebound in packaged goods sales in February and witnessed sales value growth of 26.9 percent, followed by commodities at 1.5 percent.

“We can expect to see a bigger growth in beverage product sales as the month progresses. Commodity products seem to be insulated from any wave of the pandemic as consumers lap up these products which are required as part of their daily meals,” said D’Souza.

Other categories such as confectionary, homecare, packaged foods and personal care saw a decline in sales in the first two weeks of February. Sales of confectionary declined by 6.6 percent, homecare sales dropped 12.2 percent, while packaged food sales shrank 13.4 percent so far in February (compared to January). Sales of personal care products witnessed the highest fall at 29.7 percent in the month so far.

“Most of the other categories are still to rebound with personal care products being worst affected as consumer spends on discretionary products have dropped yet again in this wave,” said D’Souza.

FMCG sales, according to Bizom, had witnessed a jump of 10 percent in January over the same period last year but dropped sequentially in comparison to December.

Data from several market intelligence platforms such as Kantar, Nielsen and Bizom indicated a slowdown in sales in rural areas in the September and December quarters. Rural areas, too, an outlier since the onset of the pandemic, have seen this downtrend this time around.

“We are seeing a slowdown in rural areas from a value and volume perspective,” Sanjiv Mehta, chairman and managing director, Hindustan Unilever Ltd (HUL), had said last month.

Consumer goods companies such as HUL, Marico, Tata Consumer Products, Dabur and Godrej Consumer Products Ltd (GCPL) are battling the dual threats of inflation and sluggish consumption. The companies have taken a series of price hikes in the last few quarters due to rising input costs. HUL has raised prices in the range of 4-22 percent across its portfolio, Dabur about 4 percent, ITC 7-10 percent and GCPL 9-10 percent so far in FY22, and have indicated that they might have to increase prices further in quarters ahead.

“The inflation impact is not mitigating. We are seeing continuous inflation despite a base of 4-5 percent inflation in the last year. On top of that, we are again seeing a 4-5 percent inflation,” Mohit Malhotra, CEO of Dabur India, said on a post-earnings investor call. “The company may have to take more price increases going forward.”

Britannia Managing Director Varun Berry said that on account of unprecedented inflation across commodities, the company will increase prices by 10 percent in the fourth quarter ending March.

“The material inflation was 4 percent in the first quarter, 14 percent in the second quarter and in the third quarter it was 20 percent,” Berry said in response to a query on a call with investors after reporting third-quarter results. “We took a 1 percent price increase in Q1, a 4 percent price hike in Q2 and in Q3 we took an 8 percent price increase. And we plan to take a 10 percent price increase in Q4.”