FMCG industry to witness a 'significant growth' in FY24, says Jyothy Labs
According to Jyothy Labs' most recent annual report, the fast-moving consumer goods (FMCG) sector is predicted to experience ‘significant growth' in FY24 as rural demand has been showing improvement and inflation has begun to moderate. The urban demand has continued to remain steady.
As per Jyothy Labs, the manufacturer of branded goods including Ujala, Henko, Margo, Exo, and Pril, growth is fuelled by large packs as there is a distinct trend among customers to upgrade to medium and high-value packs for its various key FMCG categories.
Additionally, it claimed that a number of government initiatives, such as the minimum support price (MSP), increased rural infrastructure spending, and increased credit to agriculture and other non-agricultural economic activities, will boost employment and income levels in rural areas, thereby boosting demand for FMCG products.
The company further noted that consumer preferences are changing. Consumers now choose products based on usage efficiency in addition to perceived value and shelf life. Additionally, customers continue to consider their purchases as a reflection of the ethical standards of the businesses they support and are growing more informed.
Furthermore, it was also mentioned that the growing youth population, primarily in urban areas, is a second important factor driving demand for FMCG products in India. It also predicted that by 2025, there will be one billion internet users in India, and that e-commerce will play a "crucial role" for businesses looking to expand into the hinterlands.
The Indian FMCG industry is anticipated to develop at a compound annual growth rate (CAGR) of 14.9% from US$ 110 billion in 2020 to US$ 220 billion in 2025 and to US4 615 billion by 2027, according to Jyothy Labs, citing statistics from Statista.com.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.