New Delhi, April 14 || FMCG firms in India, on aggregate, should end FY25 with low single-digit revenue as consumer staples stocks have benefited from the flight-to-safe trade recently, a new report has said, adding that the base will remain favourable in FY26.
A BNP Paribas India report expects FMCG revenue growth to inch up slightly from 4 per cent in Q3 FY25 to 5 per cent in Q4 FY25.
“As trade concerns ease, we see a risk of reversal of recent outperformance. However, we do see some near-term positives, such as the drop in crude price and our economic heat map indicates positive trends for rural growth,” the report mentioned.
Commentaries from Marico, Dabur and GCPL indicate that demand has been resilient while urban slowdown, led by weakness in general trade, persisted in Q4 FY25.
Jewellery companies are set to post strong sales growth year-on-year in Q4, helped by an increase in gold prices, the report noted.
At the beginning of the year, the consumption sector’s revenue growth was weak due to weakness in rural demand. Price cuts were also weighing on growth.
In the subsequent quarters, rural growth recovered slightly, likely helped by the low base, a good monsoon, and high food prices.
“However, this was offset by weakness in urban demand. As a result, we expect most companies to end FY25 with low to mid-single digit revenue growth,” said the report.