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The
last few years had been a slog for the Indian FMCG Industry.
But when HLL, the poster boy of this industry, posted a healthy
double-digit growth in both its top line as well as bottom
line, it must have come as a great relief to the industry
playersmore particularly, the FMCG biggiesas the years of
price war did not help anyone; except of course, the consumers.
The FMCG giant clocked a Y-o-Y growth of 11.4% in its top
line in 2005, its first double-digit growth in sales after
a gap of six years! The stellar performance also signaled
that the goliath was also able to get some market share back
as well as pricing power. And the others are not far behind
as the rosy growth projections by research s have only
boosted the morale of the industry players.
A
host of factors have driven the growth of the sector in recent
times. A robust economic growth, rising rural consumption
and power pricing are some of the major factors behind the
revival in fortune. The demand is not only coming from the
urban areas but also from the rural areas with an increase
in the rural buying power. Though the rural areas currently
account for 34% of the total FMCG consumption in the country,
in major FMCG categories such as personal care, fabric care,
and hot beverages, its share grows to more than 40%.
And
the future looks bright for the industry going by industry
experts' views. According to a research by HSBC, the FMCG
sector is set on a rapid growth trajectory with the projection
of growth to go beyond 60% till 2010. "This will translate
into an annual growth of 10% over a 5-year period," says
the research by HSBC. |
