FMCG firms report sales growth in June as supply chains stabilise

Several FMCG companies have reported sales growth in June and expect the momentum to continue in Unlock 2.0, though some challenges persist.
According to a PTI report: Firms such as Godrej Consumer Products Ltd (GCPL) and Marico expect overall growth in the April-June quarter, which was severely impacted due to the coronavirus lockdown.
GCPL expects a “mid-single-digit, volume-driven sales growth” in April-June, the company said recently in its quarterly update for Q1 FY21.
The Godrej group firm has seen a “strong recovery” from mid-May and June across most of the markets where it operates.
It is witnessing robust demand in the household insecticide category, while the hygiene segment too saw strong traction, GCPL said.
The company has a range of brands across personal and home care segment, such as Cinthol, Protekt, Ezee, Godrej No 1, Hit and Good Knight.
Another homegrown FMCG firm Marico, sharing its quarterly update, said it witnessed significant disruptions during the first fortnight of April but since then, has been able to steadily scale up operations to near-normal levels in June.
While edible oils and foods businesses resumed operations in early April as per government guidelines, hair oils and personal care segments could only commence in late April and early-May, it added.
“With the Q1 top line translating into a single digit growth over the annual run rate of FY20, the company expects to bounce back to posting volume and value growth during the rest of the year,” said Marico, which owns brand like Parachute, Saffola, Hair & Care, Nihar and Livon
According to experts, FMCG companies have seen an improvement as production and supply chains have stabilised.
“Several FMCG companies have seen a marked improvement in the last month as production and supply chain is stabilised and lockdown restrictions are lowered across states,” Pinakiranjan Mishra, Partner and National Leader – Consumer Products and Retail, EY was quoted by PTI as saying.
Some consumer durables companies have also reported growth in sales of refrigerators, vacuum cleaners, microwave ovens and washing machines.
According to Suguru Takamatsu, Divisional Head – CSD, Panasonic India, people confined within their homes have developed greater regard for appliances that help them multitask and make their lives easier.
“Since easing of the lockdown, and allowing sale of consumer electronics, we at Panasonic India, are starting to inch towards steady sales,” Takamatsu was quoted by PTI as saying.
Fuelled largely by rural demand, “y-o-y for month of June, our refrigerators (sales) grew by 40 percent, vacuum cleaners by 20 percent, microwave and washing machines (top-load) too saw an uptake of 44 percent and 24 percent respectively,” he was further quoted by PTI as saying.
Consumers are opting for large-screen TVs to binge on entertainment which is driving the growth across markets, he said.
“Grooming products, especially the trimmers have seen a 5X growth during this period, as consumers are depending less on salons to ensure safety and hygiene. We are quite hopeful that the festive season will help us recover some of the losses incurred during lockdown,” he said.