Kolkata/Ahmedabad: The FMCG industry is set to grow 20-30 per cent in 2009-10, up from 10-20 per cent in 2008-09. The growth would be driven by the launch of new products and increasing rural consumption, according to industry experts.

“By definition, FMCG addresses a very core need in the consumer’s life and so it is less prone to economic swings than high ticket items such as television or even apparel,” said Mr Hemant Kalbag, Principal, AT Kearney. Price increases on products by the companies have also been well-absorbed by the market, and so there is no reason to question the growth rate projections, he added.

The beverage industry in India is being estimated to grow at 17 per cent this year, according to experts. “Food and beverages segment has not suffered despite the slowdown in the economy. FMCG in our stores has done very well. In fact, we registered 10-15 per cent growth in this segment last year,” said a spokesperson at Spencer’s Retail Ltd.

The hot summer helped spur sales of beverages so far this year, according to senior officials.

Coca Cola India Ltd, for instance, continued to report growth for an eleventh straight quarter. “Coca-Cola in India reported solid first quarter 2009 results despite a challenging economic environment, with unit case volume increasing 31 per cent with eight quarters out of the 11 quarters delivering double-digit growth,” a Coca Cola India spokesperson told Business Line.

Emami Ltd posted 20 per cent growth in 2008-09 and achieved a consolidated turnover of about Rs 750 crore.

The company expects to maintain a growth rate of 25-30 per cent during this fiscal, said Mr Aditya V. Agarwal, Director, Emami group.

“There has not been any drop in demand for consumer products at popular price points. However, there may have been some narrowing in demand at the top-end of the market; in the mass market, demand continues to be strong, both from rural and urban markets,” he said.

The extensions of brands such as Navratna cool oil and Boroplus would act as key growth drivers for the company this year. “We are also looking at penetrating deeper into rural and semi-urban markets. We will also enter into new categories such as baby range and men’s care range this fiscal. New launches and geographical extensions of various brands will add impetus to growth,” he added.

CavinKare registered 23 per cent sales growth in 2008-09 and anticipates 30 per cent growth this year, said Mr Vineet Trakroo, Vice-President (Marketing), CavinKare. The company has lined up various marketing and branding.

On the personal care front, deodorants, shampoos and talcum powders could see double-digit growth, Mr Trakroo said. Sales in the rural areas comprised 65-68 per cent of the company’s total sales. “The penetration in rural areas is set to grow, thereby increasing the sales in the segment,” he said.