Weekly FMCG Update: Demand steadies, pharma tumbles

FMCG demand steady in Q4
Demand for fast-moving consumer goods (FMCG) remained stable in the January-March 2024 quarter, according to a report from Nomura. Sales are expected to grow by 5.2% due to price hikes, while volume growth stays steady. Rural demand shows improvement, but urban demand remains weak due to low wage growth and past inflation. Nomura anticipates a gradual urban demand recovery as inflation moderates. Price increases continue to support value growth, though FMCG companies face margin pressure.

Pharma stocks tumble amid tariff fears
Shares of Indian pharmaceutical companies plunged following comments from US President Trump suggesting potential tariffs on pharmaceutical imports. This marks a shift from earlier indications that the sector would be exempt. Stocks of major firms like Aurobindo Pharma, Lupin, and Cipla fell by up to 10%. The sector’s heavy reliance on the US market has raised concerns over rising drug prices and potential shortages. Analysts predict tariffs may impact generics' low price structures, affecting profitability.

Haldiram's: a $10 billion empire
Haldiram’s, valued at over USD 10-billion, has transformed from a small Bikaner shop into a global snack leader. Led by the Agarwal brothers, the brand revolutionised Indian snacks with modern packaging and premium offerings while retaining mass appeal. Known for innovations like zip pouches and automation, Haldiram’s now boasts restaurants in over 100 countries. Despite limited advertising, it’s become a household name worldwide, providing a mix of tradition and modernisation in its approach to the snack industry.