Market research firm Nielsen India has lowered its growth target for the fast moving consumer goods (FMCG) sector. The firm has estimated growth in 2019 to be in the 9-10 percent range for 2019 as against 11-12 percent estimated earlier. Within this, food categories are expected to grow at a higher rate (10-11 percent), whereas personal care and home care are expected to grow in the 7-8 percent range. In Q2 (April-June) 2019, value growth in the FMCG space dropped to 10 percent, inching towards a slowdown. This follows the softening from the highs of Q3 2018 (16.2 percent). Rural India contributes 37 percent of overall FMCG spends and has historically been growing around 3-5 percentage points faster than urban on account of increasing affordability, availability and demand. However, rural growth is slowing down and is double that of urban in recent quarters. This has brought rural growth closer to urban in Q2 2019. Nielsen estimated FMCG growth in July-September at 7- 8 percent and in the second half of 2019 (July-December) around eight percent. It cites monsoons, government policies and budget provisions and low base effect as factors that will impact the FMCG growth story.

(Moneycontrol)