Q3 Update: Godrej Consumer’s India Demand Continues To Face Challenges Amid Slowdown
Godrej Consumer Ltd. said its domestic demand faced challenges even in the quarter ended December as Indians curbed spending on biscuits to cars amid the worst consumption slowdown in nearly a decade.
The Adi Godrej Group’s flagship consumer goods company reported mid-single-digit volume growth in India during the third quarter, according to its quarterly update on the bourses. The maker of ‘Cinthol’ soaps witnessed relatively mixed demand across some geographies of operations, the filing said.
Domestic demand for fast-moving consumer goods makers fell as rural growth slowed and wages stagnated. Sales of cars and two-wheelers, too, failed to pick up over last year, reflecting a drop in the private final consumption expenditure. That dragged the GDP growth to its lowest in more than six years.
Still, the Godrej-group company expects a gradual improvement in consumer demand in the forthcoming quarters, driven by a good monsoon and government’s stimulus. The company recorded high single-digit constant currency sales growth in the home and personal care space in Indonesia and witnessed “robust” performance in SAARC markets, the filing said.
Last week, rival Marico Ltd., too, said its hair oil and coconut oil verticals dipped marginally in the third quarter, leading to a slight decline in volume growth of its India business.
Shares of Godrej Consumer gained as much as 0.4 percent during the day compared with a 1.5 percent drop in the Nifty 50 Index.