FMCG Sales Rise In October As Shops Stock Up Ahead Of Festivals

Confectionery, beverage and packaged foods categories drove sales as gift packs see greater traction.

FMCG products on display at the Vashi APMC market in Mumbai. (Photo: BQ Prime)

Sales of fast-moving consumer goods recovered in October, driven by certain categories as retailers stocked up for Diwali and Dussehra.

The value growth of daily essentials, excluding commodities, grew 7% in October over the previous year, led by confectionery, beverage and packaged foods as gift packs saw greater traction, according to Bizom data.

A steep decline in edible oil prices, however, dragged sales value of branded commodities, offsetting higher demand. As a result, the overall fast-moving consumer goods market shrank 4.8%, the data showed.

Rural markets, which account for 40% of the total sales in India's fast-moving consumer goods industry, are showing signs of recovery after months of stress. Excluding commodities, rural sales grew 10.2%, while urban sales grew 1.6%. Rural sales, including commodities, fell 6.1% while urban sales declined 2.2%, according to Bizom data.

Category-wise, the personal care category also remained under pressure during the month, with sales declining 3.8% as consumers continued to prioritise spending in a sustained inflationary setting, according to data from the retail intelligence firm that tracks 75 lakh mom-and-pop stores.

"It's clear that this year too we will continue to see a fight for retail shelf space during Diwali," said Akshay D’Souza, chief of growth and insights at Bizom. However, it remains to be seen if this leads to higher offtakes in order to determine real consumption. "We will have a clearer picture next month."

A separate set of data from the Confederation of All India Traders showed that the Diwali season registered a record trade of Rs 3.75 lakh crore. The traders' body estimates categories like food and grocery comprised 13% of consumer spending, followed by textiles (12%) and confectionary (8%).

"Still, the festivals of Govardhan Puja, Bhai Dooj and Chhath Puja are yet to be solemnised, which may together attract another Rs 50 crore worth of sales this month," according to CAIT Secretary General Praveen Khandelwal.

Also Read: Weak Industrial Production Suggests A Crack In India Consumer Story, Says Nomura

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WRITTEN BY
Sesa Sen
Sesa is Principal Correspondent tracking India's consumption story. She wri... more
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