Revival in Rural Demand Leads to Single-Digit Growth for FMCG Giants

The fast-moving consumer goods (FMCG) sector is seeing a single-digit volume growth in the April-June quarter, bolstered by rising rural demand and stable urban markets. Companies like Dabur, Marico, and Adani Wilmar report gradual demand improvements and anticipate margin expansions due to stable commodity prices and cost-saving initiatives.

Fast-moving consumer goods companies are expecting single-digit volume growth and a margin expansion during the April-June quarter, aided by a revival in rural demand and a steady urban market.

Listed FMCG giants such as Dabur, Marico, and Adani Wilmar have noted a gradual improvement in demand trends in their latest quarterly updates.

Dabur expects mid to high single-digit revenue growth, supported by mid-single-digit volume growth domestically. Marico reported high single-digit revenue growth and modest underlying volume growth. Adani Wilmar reported a 13% overall volume growth, with food and FMCG volumes growing 23% year-on-year.

Companies anticipate margin expansions, aided by stable commodity prices and cost-saving measures. Dabur cited stable commodity prices and expects gross margins to expand due to price increases and savings initiatives. Marico also expects year-on-year gross margin growth.

Dabur and Marico reported increases in international business. Marico plans strong growth in constant currency terms but faces challenges from currency depreciation in Turkey and Egypt. Dabur achieved double-digit constant currency growth with broad-based market gains.

(With inputs from agencies.)