The Indian FMCG Industry

The Fast Moving Consumer Goods (FMCG) sector in India has been growing at a healthy CAGR of 11% over the last decade Riding on the back of increasing demand and changing consumer preferences, thanks to higher disposable incomes and the retail revolution, the sector has been posting double-digit growth over the past couple of years The industry is volume driven and is characterized by low margins. The products are branded and backed by skilled marketing, heavy advertising, slick packaging and strong distribution networks. Also, raw material prices play an important role in determining the pricing of the final product Modern retail formats too have contributed in a major way in pushing the growth in the FMCG sector. With rising income levels and the spread of modern retail, the FMCG industrys future prospects look bright which is expected to further boost sales Growth in the sector is led by higher urban and rural demand. Going forward , the governments growing support to agriculture will drive long-term growth in consumption from the rural sector In our view, amongst all the FMCG segments, the food segment will outperform over the coming years
Industry: 
Consumer Goods & FMCG
Publisher: 
Dinodia Capital Advisors
Published date: 
09/2012