FMCG sector in india
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The document discusses the Fast Moving Consumer Goods (FMCG) sector in India. It notes that FMCG includes household care, personal care, food and beverages products that have quick turnover. The Indian FMCG sector is the 4th largest in the world and is growing rapidly, expected to reach $74 billion by 2018. Major players like HUL and ITC have large market shares. The future of the FMCG sector in India looks promising with rising incomes and large domestic market, but risks include regulatory changes and rural demand seasonality.
FMCG sector in india
- 1. FMCG
- 2. Sagar Bhatt H L institute of Commerce, Ahmedabad Mail – [email protected]
- 4. 1. What is FMCG ? - A brief Introduction Full form – Fast Moving consumer goods India’s FMCG sector is 4th largest Sector in the economy and generating 3 million employment opportunities. Includes - household care, personal care , food & beverages, etc.. FMCG products have a quick turnover and relatively low cost. India is 12th largest consuming country in the world as at 2010. These products are sold quickly and generally consumed at regular basis.
- 6. Scope & Growth in India Market size : $13.1 billion, 4th Largest in the world. Expected market size (by ‘18) : $ 74 billion. Fastest growing segment : Hair care, household care, male grooming, female hygiene, and the chocolates and confectionery categories, quick service restaurant chains, apparels, foot wear retailers. Better growth prospectus for Indian rural FMCG market, due to presence of 12.2% of world population in Indian villages.. & due to farm sector in focus, rural income can be boosted. Within the food segment, it is estimated that processed foods, bakery, and dairy are long-term growth categories in both rural and urban areas.
- 7. Firms can launch new segment of products, due to increasing demand. For ex. Procter & Gamble. Hypermarkets and supermarkets, market share – 5-7 % Expected to double to :– 10-12%. E-Commerce has become an important medium of buying and has a significant impact on the way consumers buy and consume. With an ongoing time, consumers have started demanding healthy and hygiene products. For ex. Saffola, mouth wash, sanitizers, Other low cholesterol oils and healthy products. “With the increase in income levels and choices, the demand for premium products will take a hike” said director at Cadbury India Ltd.
- 8. Operating environment & Govt policy Favourable policies by Indian Government- policies attaining international competitiveness, reducing excise duties &100% export oriented units can be set up by government approval and use of foreign brand names etc. 1. Foreign direct investment- Automatic investment approval up to 100 per cent foreign equity or 100 per cent for NRI and Overseas Corporate Bodies investment is allowed for most of the food processing sector except malted food, alcoholic beverages and those reserved for small scale industries (SSI). 2. Removal of quantitative restrictions and reservation policies 3. Food Laws
- 9. MAJOR PLAYERS COMPANY SALES (in Rs.) (2014) LOGO ITC Ltd. 29901 crores Hindustan Unilever Ltd. 28019 crores Nestle 9101 crores Dabur 4349 crores Goorej Consumer Care Pvt. Ltd. 3581 crores Colgate-Palmolive Co. 3159 crores Marico 1069 crores Procter & Gamble 1700 crores Britannia Ltd. 5615 crores Emami Ltd. 1627 crores
- 10. FMCG market capitalisation in 2013 0 50,000 100,000 150,000 200,000 250,000 300,000 ITC Ltd HUL Nestle India In Crores In Crores 2,56,769 49,768
- 11. Company Sales as on 31 March 2012 (US$ mn) Product segment Britannia Industries Ltd 785.5 Tiger, Good Day, Marie Gold Colgate Palmolive India Ltd 408.8 Colgate, Palmolive, Axion, Dish Wash Dabur India Ltd 706.5 Dabur Amla, Vatika, Fem, Dabur Gulabri, Dabur Chyawanprash, Hajmola GlaxoSmithKline Consumer Healthcare India Ltd 421.9 Horlicks, Boost, Maltova, Eno, Iodex Godrej Consumer Products Ltd (GCPL) 425.2 Ezee, Godrej Dish Wash Cinthol, Color Soft FairGlow, No 1, KeshKala. Gujarat Cooperative Milk Marketing Federation (AMUL) 1,700 Amul Hindustan Unilever Ltd. 3,700.8 Lakme, Lifebuoy, Lux, Pepsodent, Sunsilk, Ponds, Rexona, Vaseline, Fair and Lovely, Dove, Pears, Active Wheel, Rin, Surf Excel. Indian Tobacco Co. Ltd. 758.7 Aashirvaad, Sunfeast, Fiama Di Wills, Vivel. Nestlé India Ltd. 1,068.6 Everyday, Nescafé, Classic, Maggi, KitKat, Munch.
- 12. 12 COMPANY Market share Hindustan uniliver ltd. 36.4% Indian tobacco company 30% Nestle 8.2% Britannia 6% Dabur 4.3% Others 15.1% 36.4 30 8.3 6 15.1 SALES HUL ITC Britannia Dabur Others
- 14. Future prospects OPPORTUNITIES By 2020,expected to become 400,000 crores. With the increase in population and income levels, supply will be satisfied with more demand. With the initiative of Make in India, a green signal to FMCG industries. Rising income levels, i.e. increase in purchasing power of consumers. Large domestic market with more population of median age 25. High consumer goods spending. With rise in per capita incomes and awareness, the growth potential is huge. Lower price and smaller packs are also likely to drive potential up trading for major FMCG products.
- 15. RISKS Removal of import restrictions resulting in replacing of domestic brands. Tax and regulatory structure. Rural demand is seasonal in nature. Ban on excessive advertising, because of TRAI regulations. No advertising available for Alcoholic drinks & Smoking products.
- 17. CONCLUSION It is concluded from this study that FMCG sector is growing and will continue to grow very fast. This sector provides quality and quantity with reasonable cost to the consumers not doing away with its competitive edge. Consumer satisfaction is its ultimate objective.