FMCG Sector Predicted to Witness Revenue Growth of 7-9% This Fiscal Year

The FMCG sector is forecasted to experience a revenue growth of 7-9% for the fiscal year 2024-25, driven by increasing rural and stable urban demand. Product realizations are expected to grow in single digits while prices for raw materials remain stable, according to CRISIL Ratings.

The fast-moving consumer goods (FMCG) sector is projected to experience revenue growth of 7-9 per cent in the fiscal year 2024-25, a CRISIL Ratings report revealed on Saturday.

This anticipated revenue increase will be bolstered by higher volume growth, spurred by a revival in rural demand alongside steady urban demand.

In the previous fiscal year (2023-24), the FMCG sector's growth was estimated at 5-7 per cent. Product realization is expected to see a marginal increase as key raw material prices in the food and beverage (F&B) segment rise slightly. However, the prices for raw materials in the personal and home care segments are predicted to remain stable.

CRISIL Ratings Director Rabindra Verma noted that revenue growth will differ across product segments and companies. He added, ''The F&B segment is likely to grow by 8-9 per cent this fiscal, driven by improved rural demand. The personal care segment is projected to increase by 6-7 per cent, while the home care segment is expected to expand by 8-9 per cent.'' The report also noted that FMCG firms would continue to explore inorganic growth opportunities to expand their product offerings. Sustained improvement in the rural economy, reliant on monsoon and farm incomes, will be crucial for maintaining steady demand.

(With inputs from agencies.)