FMCG Q3 Results Preview- Muted Demand Conditions Continue: KRChoksey

KRChoksey Report

A meaningful pick up in demand remains elusive:

Demand trends for the fast-moving consumer goods sector broadly remained steady on a QoQ basis indicating lack of significant demand uptick. India’s consumer price index has moderated from the peak of 7.44% seen in July 2023 to 5.55% in November 2023.

Consumer price index-food which peaked in July 2023 at 11.51%, moderated to 6.61% in October 2023, but again inched up to 8.70% in November 2023. While the inflation continues to moderate, it is yet to be translated to a meaningful demand uptick, especially in rural markets.

While October 2023 saw some uptick in sales due to festive stocking, November 2023 was under pressure due to the higher inventory levels. Overall, the anticipation that the festive season would be strong is not expected to materialize favorably in Q3 FY24E.

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