Consumer goods sales rebound to pre-Covid levels in June

Mumbai | Kolkata: Sales of consumer goods rebounded in June to levels seen before the lockdown, giving some companies the confidence necessary to forecast single-digit, top-line growth in a quarter expected to have been a washout for other pockets of the economy. Supply chain constraints and operational curbs didn’t dent demand, companies said, with some segments of the broader consumer industry likely reporting higher sales than even the year-ago period.“Within urban, the retail markets are yet to fully recover in terms of their operations. But the local city wholesale continues to show spine. Overall demand has steadily improved in May and June as compared with April,” said Sunil Kataria, CEO, Godrej Consumer Products, which expects mid single-digit sales growth in India.In a stock exchange update last week, Marico had said its first-quarter top line could see single-digit growth exceed the annual run rate of FY20, and will bounce back during the rest of the year. This is in contrast with the preceding January-March quarter, which saw sales decline at most consumer companies even though the lockdown only began toward the end of that period.Through the shutdown, panic buying led to sales surging for household and packaged food products amid several rounds of pantry loading.76844892“The June quarter growth is even better than that of last year as at-home consumption increased while access to outside food was restricted,” said Varun Berry, MD at Britannia Industries. To be sure, the trend is slightly different for pricier goods. Most consumer electronics and home appliance companies such as LG, Sony, Panasonic, Voltas and Bajaj reached 95-100% of the year-earlier level in June but overall sales growth for the quarter will still be half of the period in 2019.“The pent-up demand took the industry by surprise,” said Panasonic India CEO Manish Sharma. Sales of refrigerators expanded the fastest ever last month at 43%, televisions by 50% and washing machine sales started much earlier than the usual monsoon season, said Sharma.Bajaj Electricals MD Shekhar Bajaj said categories such as fans and appliances have all reported positive growth in June.“Malls are still not operational fully, a lot of stores are closed and consumers are scared to leave homes. Yet, we could achieve last year's numbers in June and now expect positive growth,” he said.US-based tracker IDC India research director Navkendar Singh said mobile phone factories could not operate at full capacity and stock became an issue for retailers in the second half of June.

from Economic Times https://ift.tt/3iEbTcs