Consumer goods sector growth reached 9%, boosted by the recovery of the rural market: NielsenIQ Report
According to a NielsenIQ report, India's consumer goods sector had a 9% increase in value during the July-September quarter as rural consumers' spending power increased.
According to the market research agency, rural markets continued to improve during the quarter, with sales volumes increasing 6.4% from 4% in the June quarter.
The volume of the rural market had decreased throughout the last four quarters by 2-5%. Rural India has seen a persistent decline in the demand for consumer products as a result of rising costs for basic necessities like milk and wheat flour, which forced people to cut back on both necessities and discretionary expenditure.
However, according to Mr. Satish Pillai, Managing Director of NIQ India, consumers' willingness to spend increased due to slower price increases, a decline in unemployment, and the government's move to cur cooking gas costs.
Retail inflation in India reached a 15-month high in July before declining in August and September. According to figures from the Centre for Monitoring Indian Economy, unemployment decreased to 7.1% in September but increased to over 10% in October.
According to the report, there appears to be a shift in rural consumers' purchasing habits towards non-essential items, as evidenced by the rise in expenditure on discretionary categories such as home care and personal care products.
While rural markets began to recover, consumer growth in metropolitan regions remained steady.
According to the report, consumption in the retail sector increased 7.5% in traditional trade and 19.5% in contemporary commerce during the quarter. While mom-and-pop shops include traditional trade, massive supermarket chains are part of modern trade.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.