FMCG cos expect double-digit growth in Q3

The Rs 85,000-crore Indian FMCG industry is expected to register a healthy growth in the third quarter of 2008-09 despite the economic downturn. The industry is expected to register a 15% growth in Q3 2008-09 as compared to the corresponding period last year, predict industry analysts.   Industry captains in the FMCG sector are also optimistic about the industry's performance in Q3 2008-09. Adi Godrej, chairman of the Godrej Group, said, "I think the Indian FMCG industry's sales growth should be good in Q3. My expectation is that the industry will register a 25% sales growth in Q3 2008-09."

Sharing similar sentiments, Amit Burman, vice-chairman of Dabur India Ltd, said that the industry will perform well in Q3 2008-09.   "I expect the industry to post strong sales growth in Q3. The reason is simple-rural demands have increased in India as people are spending more on day-to-day needs. As oil prices have come down, we will be able to sustain our price points in 2009," he added.

Bharat V Patel, chairman, Procter & Gamble Hygiene and Health Care Ltd, is very optimistic about the growth of the industry in Q3.

"The industry will register growth in sales as well as profits in Q3. I think the growth momentum will continue in Q4. I expect the industry's sales growth to range 10-20% for different companies."

According to Patel, the industry is not affected by the economic slowdown as yet, as consumers need day-to-day goods. Sunil Duggal, chief executive officer, Dabur India, expects the industry to perform well in Q3.

"Despite sales growth, I think there will be pressure on margins on account of input costs. As inputs costs are coming down now, I expect better results in Q4," he added.

Sangeeta Talwar, executive director (marketing), Tata Tea Ltd, expects the industry to grow by 15% in the third quarter of 2008-09.

"I think the industry is doing pretty well, bucking the trend. As it is meeting the every-day demands of consumers, it will continue to grow. In the last two months, input costs have come down and this will reflect in Q3 and Q4 results," she added.

In essence, a double-digit growth is expected in earnings and revenues of FMCG companies in Q3 2008-09, predict analysts.

 

Courtesy:ibef