Study report:: Indian FMCG Sector
July 35, 2013
With a inhabitants of above one billion dollars, India is among the largest financial systems in the world with regards to purchasing power and increasing consumer spending, next to China. The Indian FMCG industry, with an estimated marketplace size of ~`2 trillion, accounts for the fourth major sector in India. Within the last decade, the FMCG sector has grown in an average of 11% a year; in the last five years, annual growth accelerated at exponentially boosted rate of ~17. 3%. The sector is seen as a strong existence of global businesses, intense competition between arranged and unorganized players, well-established distribution network and low operational expense. Availability of essential raw materials, less costly labor costs and occurrence across the whole value sequence gives India a competitive advantage. During 2012, the region witnessed substantial inflation, muted salary hikes and decreasing economic progress, which afflicted the FMCG sector with companies submitting deceleration in volume progress in their quarterly results. Nevertheless , the trend seen in 2012 probably will accelerate in 2013 since growth may come from rural dwellers which might be expected to get a rise in their disposable earnings. Fast Information: Indian FMCG Industry
пѓњ The Indian FMCG industry represents almost 2 . 5% of the country's GDP. пѓњ The market has tripled in size in past ten years and has grown at ~17%CAGR in the last a few years motivated by rising income levels, increasing urbanisation, strong countryside demand and favourable demographic trends.
пѓњ The sector accounted for 1 . 9% from the nation's total FDI inflows in Apr 2000- Sept. 2010 2012. Total FDI inflows into India from The spring 2000 to April 2013 in the foodstuff processing sector stood for `9, 000. 3 crore, accounting intended for 0. 96% of overall FDI inflows while the cleansers, cosmetics and toiletries, accounting for zero. 32% of overall FDI at `3, 115. 5 crore.
пѓњ Food products and private care together make up two-third of the sector's revenues. пѓњ Rural India accounts for much more than 700 mn consumers or perhaps 70% from the Indian population and makes up about 50% from the total FMCG market.
пѓњ With changing lifestyle and increasing client demand, the Indian FMCG market is likely to cross $80 bn by 2026 in towns with population up to 10 lakh.
пѓњ India's labor cost is amongst the cheapest in the world, following China & Indonesia, offering it a competitive edge over different countries.
пѓњ Unilever Plc's $5. 5 billion put money for a 23% stake in Hindustan Unilever is the largest Asia Pacific cycles cross line inbound merger and purchase (M& A) deal so far in FY'14 and is the fifth largest India Incoming M& A transaction upon record until date.
пѓњ Excise obligation on cigarette has been improved in the Union Budget for 2013-14, which will hit main industrial conglomerates like ITC, VST Industries in the short term.
Opportunities in FMCG Sector:
пѓњ Untapped country market
пѓњ India is one of the world's
biggest producers of a
number of FMCG products nevertheless the country's exports
account for a really small proportion of the general
Market: With 200 mn persons
expected to shift to prepared and grouped together food,
India needs around USD 40 bn of investment inside the
food digesting industry.
Essential Concerns for the sector:
пѓњ High inflation
пѓњ Rising cost of inputs
пѓњ Emergence of personal labels
пѓњ Counterfeits and pass-offs
пѓњ Rupee devaluation may struck margins of companies
пѓњ Infrastructure bottlenecks
Research statement:: Indian FMCG Industry
Come july 1st 30, 2013
FMCG sector вЂ“ Summary
The fast-moving consumer items (FMCG) sector is an important contributor to India's GDP in fact it is the fourth largest sector with the Indian economic climate. Items in this category aim at frequent ingestion and they usually yield a high return. The most frequent in the list are toilet soaps, detergents, shampoos, toothpaste, saving products, sneaker polish, grouped together foodstuff, and household accessories and reaches up to certain electric...