FMCG volume growth highest in 8 quarters at 7.5% in April-June quarter; value growth of 12.2%: NielsenIQ

economictimes.indiatimes.com:

FMCG) sector grew 7.5% by volumes in the April-June 2023 quarter, the highest in the last eight quarters, led by revival in rural India and higher growth in modern trade, researcher NielsenIQ said in its quarterly report Thursday. By value, the industry grew 12.2% in the quarter, 1.3% higher than the same period last year, driven by higher consumption growth, the researcher said. This growth comes two years after the industry, impacted by high inflation, had seen price-led growth for more than two years.

NielsenIQ flagged that rural markets saw some recovery with volumes growing 4% year-on-year, compared to flat growth of 0.3% last quarter and degrowth of 2.4% in the same quarter last year. Urban markets continued momentum with consumption growth of 10.2%, which is double the 5.3% growth of saw last quarter. “The quarter (April-June) is thus far the best quarter in a year and a half, with positive strides across all growth vectors we track.

Recovery in rural markets, which was in negative territory for the last few quarters, is primarily driven by non-food,” Roosevelt D’Souza, lead, customer success, Nilesen IQ, said in a statement. “This combined with a 21% growth in modern trade augurs well for the upcoming festive seasons.” NielsenIQ said the foods category saw volumes grow 8.5% in the quarter driven by staples and impulse categories. Non-food categories saw growth of 5.4% percent, (from 0.2 percent in the preceding quarter).

The researcher said modern trade continues to see double-digit consumption growth of 21.1%, while traditional trade grew 6.2% in the quarter, compared to 1.9% in the preceding quarter. «The softening of India’s inflation rate and the decline in food inflation is good news for the industry. This