Bussines Economics

FMCG are populary named as consumer packed goods.
The items are meant for daily of frequent consumoption & have a high return. Many major players are included in this sector. A large number of opportunities is available in the FMCG sector. The finance ministor has proposed to introduce an integrated goods and service tax by april 2010.
In India, the FMCG industry is the fourth largest sector and are classified as premium and popular segments. The market growth over the past 5 years has been phenomenal, primarily due to consumers growing disposal income.
The large population in the rural and semi urban regions is driving demand growth, with continuous rise in disposable income etc. The consumer goods sector in India has managed to defy the trend. Indias FMCG industry has so far been resilient to the slowdown in the economy and a dip in consumer sentiment. As said by Mr. William pinckey I am not saying that our company is recession proof but it is recession resilient. Price hike and cost cutting were the first lines of defense in a bid to protect margins.

1) 2)
HOUSEHOLD CARE
Personal wash Detergents
1) 2) 3)
Personal care
Skin care Hair care Oral care
1. 2.
Food and beverages

Food segment Tea and coffee
LARGE MARKET.
SPENDING PATTERN.
What came in? Continued spending on rural and social development Roll-back in excise duty reduction from 8% to 10% Positive for all FMCG companies Negative for FMCG companies especially HUL as higher sales from non-excise free units. Neutral for Dabur Negative for cigarette manufacturers. Marginal impact on ITC (exited nonfilter segment), has already increased prices of its Gold Flake brand and can take suitable price hikes to mitigate the impact Positive for food processing companies Negative for Procter & Gamble Hygiene and Health Care
New excise slab of Rs669/100 sticks introduced in filter cigarettes under 60mm. Excise on other filter cigarettes raised by 9-18%, excise on non-filter cigarettes (>60mm but <70mm) increased by 11% Government to set up five additional mega food parks Excise duty of 10% levied (earlier Nil) on baby & clinical diapers and sanitary napkins
Excise duty on goods covered Positive for HUL as under the Medicinal and Toilet deodorants and perfumes Preparations Act reduced from could get cheaper 16% to 10%
Highly unorganised. Inadequate distribution network. High competition between large and small players.
KEY GROWTH DRIVERS

Availability of raw materials. Vast agriculture output. Low labour cost.
Large domestic market.

Presence across value chain. Growing share of organised retail.
Focus on health.
Impact of inflation. Micro segmentation. Low value SKUS. Jet age consumer products. Mainstream penetrated growth categories. Under penetrated growth categories. Low per capita consumption. Innovative product forms.
Strengths:
1. Low operational costs 2. Presence of established distribution networks in both urban and rural areas 3. Presence of well-known brands in FMCG sector Weaknesses: 1. Lower scope of investing in technology and achieving economies of scale, especially in small sectors 2. Low exports levels 3. "Me-too" products, which illegally mimic the labels of the established brands. These products narrow the scope of FMCG products in rural and semi-urban market. Opportunities: 1. Untapped rural market 2. Rising income levels, i.e. increase in purchasing power of consumers 3. Large domestic market- a population of over one billion. 4. Export potential 5. High consumer goods spending Threats: 1. Removal of import restrictions resulting in replacing of domestic brands 2. Slowdown in rural demand Tax and regulatory structure
COMPANY HIND.UNIL
SALES(RS.MILLION) 175238.00
Market cap(RS.MILLION) 586171.10
DABUR INDIA
GODREJ CONSUMER COLGATE PALMOLIV MARICO P&G HYGIENE EMAMI
28568.70
12678.81 19624.59 20242.90 7742.06 9905.77
179377.27
125002.87 112656.45 78625.05 73273.62 70004.38
GODREJ INDUSTRIES
GILLETE INDIA NIRMA
8163.68
6615.13 31179.50
66240.67
61936.35 31963.73
There is a huge market potential for all the FMCG companies as the per capita consumption of almost all products in the country is amongst the lowest in the world.earlier indian consumers were using non branded appreal,but today, clothes of different brands are available and the same consumers are willing to pay more for branded quality clothes. Its the quality, promotion and innovation of products, which can drive many sectors.
PRESENTED BY SHIV SHRIGOPAL MAHESH

Bussines Economics

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Bussines Economics

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FMCG are populary named as consumer packed goods.

Food and beverages

KEY GROWTH DRIVERS

Availability of raw materials. Vast agriculture output. Low labour cost.

Large domestic market.

Market cap(RS.MILLION) 586171.10

PRESENTED BY SHIV SHRIGOPAL MAHESH

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