Slowdown blues for FMCG to continue in December quarter

Inflationary pressures weigh on consumer expenditure

- VIVEAT SUSAN PINTO

RISING INFLATION IN vegetable oils and food is likely to impact the third quarter performance of leading fast-moving consumer goods (FMCG) players. Godrej Consumer (GCPL), in its Q3 update, has highlighted slowdown concerns during the period and has said it expects flattish underlying volume growth and mid-single digit sales growth due to subdued demand conditions, notably in soaps and household insecticides.

"The surge in palm oil and derivatives prices to the extent of a year-on-year increase of 20-30% has impacted the soaps category, which represents one-third of our standalone business revenue. To partly offset the cost increases we have taken price increases, reduced grammage of key packs and reduced various trade schemes," GCPL said. GCPL is the country's second-largest soaps maker after Hindustan Unilever (HUL).