Volume growth returning, rural demand seeing green shoots: Procter & Gamble
inflation, volume growth is finally returning and rural demand is witnessing green shoots, Procter & Gamble Hygiene and Health Care Ltd (PGHHL) said on Friday. PGHHL, which reported a 12 per cent sales growth in FY23 and 3 per cent sales growth in the first quarter this fiscal, said FMCG consumption in the June quarter was the fastest in the last six quarters.
«Inflation is softening and volume growth is finally returning.
A growth of 7.5 per cent in a quarter for the industry is great news,» PGHHL Vice President Finance Gautam Kamath said in an investors' call.
This volume growth eventually unlocks capital investment and triggers a positive investment cycle.
«In another piece of good news, the rural demand is growing as well. With a quarter showing 1.4 per cent volume growth in the non-food sector in the rural economy after four quarters of significant volume decline,» he added.
After a couple of years of flat volume growth, the industry as a whole is looking to come back strongly and competitive activity is fairly intense, he added.
PGHHL, which owns popular brands such as Vicks in healthcare and Whisper in feminine care, remains «optimistic about growth with some concerns about the monsoon and retail inflation, but the broader trend is very encouraging».
«It will also require companies like us to continue to invest in rural growth through awareness programmes, which we are already working towards,» he said.
On growth expectations for the next 5-7 years, he said, «We expect volume consumption growth within the FMCG category to be in the mid-single digits.»
However, Kamath added there are several categories, where consumption is fairly low, and P&G is looking at the potential to further improve and impact consumers'
