FMCG sales grow nearly 37% year-on-year in June quarter, but fall 2% sequentially: Nielsen

The impact of the second wave of Covid-19 on the country’s fast-moving consumer goods (FMCG) market was negligible with sales slipping only 2% sequentially in the April-June quarter, data from market tracker Nielsen shows.
In fact, the FMCG market grew 36.9% year on year during the quarter, according to Nielsen data, as companies were better prepared to deal with lockdowns and movement restrictions during the second wave than the first wave.

Contribution of ecommerce to overall FMCG sales in top 52 cities in the country touched the double digit mark in May.

“The channel’s growth trajectory continues to hold promise in light of the convenience quotient led by e-tailers’ action and evolving consumer aspirations,” said Sameer Shukla, customer success lead at NielsenIQ South Asia.



Traditional trade channels like grocery stores and chemists exhibited strong growth in the quarter and had a strong ally in ecommerce to sail through the troubled waters.

Modern trade is still in the recovery phase compared to pre-Covid period, expecting faster recovery during the festive season, Nielsen said.

Rural markets continued to grow on the back of good Monsoon, supported by government incentives. The metropolitan (top 52) cities also saw a significantly lesser impact during the second wave, as lockdowns were regional, causing lesser disruption in the supply chain.

“While last year we were caught unaware because of the lockdown, the entire capability in terms of all kinds of black swan scenarios, we have become far, far agile in terms of supply chain management,” Saugata Gupta, managing director of Marico, had told investors last month. “We have witnessed improving demand trends in India from June and it continued in July,” he had said.

Amid the nationwide lockdown last year, sales of ready-to-eat and packaged products had surged after consumers hunkered down in their homes.

However, the second wave didn't see similar pantry loading.

“Last year, we had seen a very resurgent first quarter, reasonably resurgent second quarter, and then we had seen a little bit of a cool off that had happened due to the economy, Covid and some businesses shutting down,” Varun Berry, managing director of biscuits maker Britannia, had said in an analyst call earlier this month. “But this time, the government hopefully is going to do all that is necessary to keep this going and the government's measures will make a huge difference to how this pans out in the coming months and coming quarters,” he had said.