FMCG demand to revive in second half: Emami

KOLKATA: FMCG firm Emami Ltd chairman RS Agarwal said though the overall environment continues to be challenging, he expects demand to revive in the second half of the fiscal year.

Addressing Emami shareholders during the company's 36th annual general meeting held here on Thursday, Agarwal said the company expects consumer sentiments to pick up driven by a young aspirant population, growing rural income, normal monsoon and increased government impetus.

He said Emami is "attractively placed to capitalize the opportunity of the upscaling of the demand momentum that is expected to set in the second half of FY 2019-20..."

Growth in FMCG sector has slumped in the past four quarters in a row since July-September 2018, both by value and volume, as consumers shifted to cheaper daily essential brands in the urban markets and rural growth slowed.

Value growth, or revenue earned, fell from 16.5% in July-September 2018 to 10% in the June quarter this year, according to market researcher Nielsen.Growth by volume, or the number of packs sold, dropped from 13.4% to 6.2% in the same period.

Agarwal said Emami is focusing on newer channels like modern trade and e-commerce to drive growth. Modern trade reported a growth of 43% thereby increasing its contribution from 6% to 8% of Emami's domestic business in 2018-19, while e-commerce segment grew by 112% over the previous fiscal.