FMCG firms report single-digit volume growth with better margin in December quarter

New Delhi: Fast-moving consumer goods (FMCG) companies have reported single-digit volume growth with improved margins in most segments during December quarter, helped by moderating commodity inflation, though operating environment remained challenging.

Some of the companies also reported a decline in their topline numbers, as they extended the benefits of softening commodity prices to the consumer by lowering the prices, which had a bearing on their gross sales numbers.

Companies such as HUL, ITC, Marico, Dabur, and Godrej Consumer Products said urban markets continued their moderate growth, while consumer demand from rural India remained subdued even as they expect an improvement in coming quarters.

Moreover, the late arrival of winter also impacted the pickup of relevant products such as lotions, oils and creams.

Hindustan Unilever (HUL) reported a muted growth in consolidated net profit at Rs 2,508 crore and its sales were marginally down to Rs 15,259 crore.

“Overall, FMCG demand trends have largely remained stable and similar to what we saw last quarter. While market volumes grew at high single digits year-on-year, this came on a base period where volumes declined in mid-single digit,” said HUL CEO & MD Rohit Jawa in his latest earnings call.