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By
Reuters
Published
Jul 18, 2019
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India's consumer goods growth slows as rural demand cools: Nielsen

By
Reuters
Published
Jul 18, 2019

India’s consumer goods industry is losing steam as spending in the country’s rural heartland cools and small manufacturers lose competitive advantages in a slowing economy, market research firm Nielsen said on Thursday.


India's consumer goods growth slows as rural demand cools: Nielsen


Volume growth in India’s fast-moving consumer goods (FMCG) sector slowed to 6.2% in the three months to June from 9.9% in the previous quarter, Nielsen said, citing internal data from retail research.

“The sentiments echo those in India’s economic environment, with GDP moving down,” the report said.

In Jan-March, India’s economy grew at its slowest pace in more than four years, while retail inflation hit an eight-month high in June on higher food prices.

Growth in the consumer goods sector in rural India, where over two-thirds of Indians live, was slowing at twice the rate of urban areas in the previous few quarters, Nielsen said.

India’s biggest FMCG companies also posted disappointing results in the March quarter. Hindustan Unilever Ltd, which owns brands such as Dove, Surf excel and Lakme, reported a smaller-than-expected rise in profit, while rival Dabur India Ltd posted a fall in profit.

Nielsen also cut its forecast for FMCG growth for the first half of 2019 to 12% against their earlier prediction of 13-14%.

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