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By: Name Sumit Agarwal Ayushi Agarwal Amit Gunjan Aditya Jain Abhay Nigam Kaushik Cheekotey CLK Kiran Approved BY: Mr. Nitin Gupta ID 13A3HP029 13A2HP010 13A2HP019 13A1Hp046 13A1HP027 13A1HP010 13A3HP053
A Report Submitted in Partial Fulfilment Of The Requirement Of Course BC-541 Report Writing IMT Hyderabad
Acknowledgement
Our Team would like to express the gratitude to Dr. Nitin Gupta, Associate Professor and Area Coordinator-Marketing, Institute of Management Technology Hyderabad for allowing us to present this report on FMCG Sector and we would also like to thank him for introducing us to the format of report writing, giving us guidance in understanding formal report and provided materials in order to present it in a systematic way. We would also like to thank our batch mates who helped in providing us the inner view of FMCG sector and constantly motivated us in completing this report.
Table Of Contents
Acknowledgement Abstract 1. Introduction 1.1 Size Of FMCG Sector 1.2 History of FMCG Sector in India 2. Growth Rate of the FMCG Sector 3. Top 10 Companies in Sector with Turnover 4. Major Players in FMCG 5. Growth Drivers, Challenges and Opportunities for FMCG Sector 5.1 Growth Drivers 5.2 Supply Side Drivers 5.3 Systemic Drivers for Sectorial Growth 5.4 Challenges 6. Top Personalities Of FMCG Sector 7. FMCG Trends 7.1 Introduction 7.2 Features and benefits 7.3Merger And Acquisition 8. Conclusions
Abstract
This report provides an overview on FMCG Sector, which is one of the multimillion dollar sectors. It spans over other specific sectors such as household care, personal care, food and beverages and health care. We have also tries to focus on percentage growth rate of FMCG, the growth drivers involved for this growth rate. Also, details about top market players and their strategy to capture Indian market, then to sustain in this competitive environment. The emphasis was also laid on top personalities, market trend, merger and acquisition, peculiarities and profitability.
Introduction
Fast Moving Consumer goods are also called as consumer packaged goods that are sold quickly and relatively at low cost. FMCG is probably the most classic case of low margin/ high volume business. The Indian FMCG sector is the fourth largest sector in the economy with an estimated size of more than Rs1300 billion. Indias FMCG market is highly fragmented and considerable part of market comprise of unorganised players selling unbranded and unpackaged products. FMCG Sector has four main segments:
FMCG
Household Care Personal Care Food & Beverages Health Care
Oral Care, Hair Care, Skin Care, Cosmetics/ deodorant, Feminine Hygiene & Paper Products
Health Beverages, Staples/ Cereals, Bakery Products, Snacks, Chocolates, Ice cream, Tea/coffee/soft drinks, processed fruits & Vegetables, Dairy Products
The companies mentioned in Exhibit I, are the leaders in their respective sectors. The personal care category has the largest number of brands, i.e., 21, inclusive of Lux, Lifebuoy, Fair and Lovely, Vicks, and Ponds. There are 11 HLL brands in the 21, aggregating Rs. 3,799 crore or 54% of the personal care category. Cigarettes account for 17% of the top 100 FMCG sales, and just below the personal care category. ITC alone accounts for 60% volume market share and 70% by value of all filter cigarettes in India. The foods category in FMCG is gaining popularity with a swing of launches by HLL, ITC, Godrej, and others. This category has 18 major brands, aggregating Rs. 4,637 crore. Nestle and Amul slug it out in the powders segment. The food category has also seen innovations
like softies in ice creams, chapattis by HLL, ready to eat rice by HLL and pizzas by both GCMMF and Godrej Pillsbury. This category seems to have faster development than the stagnating personal care category. Amul, India's largest foods company, has a good presence in the food category with its ice-creams, curd, milk, butter, cheese, and so on. Britannia also ranks in the top 100 FMCG brands, dominates the biscuits category and has launched a series of products at various prices. In the household care category (like mosquito repellents), Godrej and Reckitt are two players. Goodknight from Godrej, is worth above Rs 217 crore, followed by Reckitt's Mortein at Rs 149 crore. In the shampoo category, HLL's Clinic and Sunsilk make it to the top 100, although P&G's Head and Shoulders and Pantene are also trying hard to be positioned on top. Clinic is nearly double the size of Sunsilk. Dabur is among the top five FMCG companies in India and is a herbal specialist. With a turnover of Rs. 19 billion (approx. US$ 420 million) in 2005-2006, Dabur has brands like Dabur Amla, Dabur Chyawanprash, Vatika, Hajmola and Real. Asian Paints is enjoying a formidable presence in the Indian sub-continent, Southeast Asia, Far East, Middle East, South Pacific, Caribbean, Africa and Europe. Asian Paints is India's largest paint company, with a turnover of Rs.22.6 billion (around USD 513 million). Forbes Global magazine, USA, ranked Asian Paints among the 200 Best Small Companies in the World. Cadbury India is the market leader in the chocolate confectionery market with a 70% market share and is ranked number two in the total food drinks market. Its popular brands include Cadbury's Dairy Milk, 5 Star, Eclairs, and Gems. The Rs.15.6 billion (USD 380 Million) Marico is a leading Indian group in consumer products and services in the Global Beauty and Wellness space.
CAGR- 17.3%
Food products are the leading segment, accounting for 43 per cent of the overall market. Personal care (22 per cent) and fabric care (12 per cent) are the other leading segments. Growing awareness, easier access, and changing lifestyles have been the key growth drivers for the sector. Rural demand is set to rise with rising incomes and greater awareness of brands. The Government of India has been supporting the rural population with higher minimum support prices (MSPs), loan waivers, and disbursements through the National Rural Employment Guarantee Act (NREGA) program. These measures have helped in reducing poverty in rural India and have thus propped up rural purchasing power. With rise in disposable incomes, mid- and high-income consumers in urban areas have shifted their purchasing trend from essential to premium products. In response, firms have started enhancing their premium products portfolio. Indian and multinational FMCG players
are leveraging India as a strategic sourcing hub for cost-competitive product development and manufacturing to cater to international markets. Food products and personal care together make up two-thirds of the sectors revenues Food products is the leading segment, accounting for 43.0 per cent of the overall market Personal care (22.0 per cent) and fabric care (12.0 per cent) are the other leading segments
urban segment is the largest contributor to the sector, accounting for over two-thirds of total revenue
Semi-urban
and rural segments are growing at a rapid pace; they currently account for 33.5 per cent of revenues
FMCG
The rural segment is fast catching up: The urban FMCG market in India has been growing at a fairly steady and healthy rate over the years; encouragingly, the growth in rural markets has been more fast-paced During FY11, more than 80 per cent of FMCG products posted faster growth in rural markets as compared to urban ones Notable high growth sectors include salty snacks, refined edible oil, healthcare products, iodised salt, etc Hair oils, toothpastes and shampoos have significantly high penetration in both urban and rural markets Instant noodles, floor cleaners and hair dyes are picking up in the rural areas due to increased awareness. A total of 7.8 million retail outlets sell FMCG in India Grocers are the dominant retail format, accounting for 59.0 per cent
70 60 50 40 30 20 10 0
URBAN
RURAL
Source: AC Nielson, Aranca Research
The burgeoning middle class Indian population, as well as the rural sector, presents a huge potential for this sector. The FMCG sector in India is at present, the fourth largest sector with a total market size in excess of USD 13 billion as of 2012. This sector is expected to grow to a USD 33 billion industry by 2015 and to a whooping USD 100 billion by the year 2025. This sector is characterized by strong MNC presence and a well established distribution network. In India the easy availability of raw materials as well as cheap labour makes it an ideal destination for this sector. There is also intense competition between the organized and unorganized segments and the fight to keep operational costs low.
Hair Oil
42 %
15%
8%
5%
Shampoo
10% 6%
46%
24%
59% 7%
7%
6%
Fruit Juice
52% 35%
Company HUL Amul India Nestle India ITC** Britannia Dabur Marico Industries GSK Consumers Cadbury Industry Colgate Palmolive P&G Godrej
Sales* in MN $ 3921.5 1771.1 1155.4 305.7 759.9 635.9 449.3 447.9 430.1 391.8 388.5 280.5
Segments Personal care, Food Products, Household, Baby Care, Fabric Care Food and Beverage Products Food and Beverage Products Personal Care, Food Products Food Products Personal Care, Food Products, Household Personal Care, Food Products, Household Personal Care, Food Products Food Products Personal Care, Oral Care Personal care, Food Products, Household, Baby Care, Fabric Care Personal Care, Fabric Care
Source: Relevant company websites, IBEF report *Yearly sales as of March 2010, ** FMCG business excluding tobacco
ITC
Overview
ITC Limited is an Indian public conglomerate company (25.4% owned by British corporation, British American Tobacco) headquartered in Kolkata, West Bengal, India. Its diversified business includes four segments: Fast Moving Consumer Goods (FMCG) Hotels, Paperboards Paper & Packaging Agri Business ITC's annual turnover stood at $7 billion and market capitalization of over $34 billion. The company has its registered office in Kolkata. It started off as the Imperial Tobacco Company, and shares ancestry with Imperial Tobacco of the United Kingdom, but it is now fully independent, and was rechristened to Indian Tobacco Company in 1970 and then to I.T.C. Limited in 1974. It employs over 29,000 people at more than 60 locations across India and is listed on Forbes 2000. ITC Limited completed 100 years on 24 August 2010. ITC has a diversified presence in FMCG (Fast Moving Consumer Goods), Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business and Information Technology. While ITC is an outstanding market leader in its traditional businesses of Hotels, Paperboards, Packaging, Agri-Exports and Cigarettes, it is rapidly gaining market share even in its nascent businesses of Packaged Foods & Confectionery, Branded Apparel, Personal Care and Stationery.
Marico
Overview
Marico is an Indian consumer goods company providing consumer products and services in the areas of Health and Beauty based in Mumbai. Marico's own manufacturing facilities are located at Goa, Kanjikode, Jalgaon, Pondicherry, Dehradun, Baddi, Paonta Sahib and Daman. Key brands: Parachute, Saffola, Hair&Care, Nihar, Mediker, Revive, Manjal, Kaya Skin Clinic, Aromatic, Fiancee, HairCode, Eclipse, Xmen, Hercules, Caivil, Code 78 and Black Chic. The Board of Directors of Marico has approved the restructuring of businesses, corporate entities and the organization involving a) the demerger of Kaya Skin Care Solutions (Kaya)
into a separate company by the name Marico Kaya Enterprises Ltd (Make) and b) formation of an unified FMCG business with operations in India and abroad, headed by a single CEO. The restructuring plan would be effective from April 1, 2013. Kaya to be demerged into a separate listed company: As per the proposed demerger plan for Kaya, Make will become the holding company of Kaya Ltd (India) and Kaya entities in the Middle East and South East. Currently the promoters of Marico have a 60% stake in the company (Marico); post demerger the shareholding structure of Make will be identical to Maricos current shareholding structure. Shareholders of Marico will be allotted one share of MaKE for every 50 shares held in Marico. Marico will not hold any stake in Make post demerger. The equity shares of MaKE will be listed after all the statutory approvals are obtained. Formation of a unified FMCG business: Marico currently has three business verticals namely a) Indian consumer products b) The international FMCG business and c) Kaya with operations in India and abroad. Post the restructuring, Kaya would operate as a separate listed entity (Make). The Indian and International FMCG businesses, which were till date headed by two different CEOs, will be unified and headed by a single CEO.
Britannia Industries
Overview
Britannia is one of the foremost food companies in India. The company is present across the biscuits, dairy products and breads segments and has recently forayed into the breakfast cereals category with the launch of Healthy Start. Britannia derives ~85% of its revenue from the biscuits segment, where it has formidable brands such as Tiger (glucose biscuits), Treat (cream biscuits), 50-50 (crackers), Good Day (premium cookies and the company's highest selling brand) and NutriChoice (premium high-fibre biscuits). During the first quarter of 2012, Britannia launched Bourbon, Cappuccino, Pure Magic Praline and a new range of creamy flavours for Treat.
Demand Side Drivers: Increasing Consumer Income High Private Consumption Rising Urbanization
Health Care Transport Communication Recreation Cultural Services Education Rent Utilities Other Services
Rising Urbanization:
India has 70% of its population living in rural areas. With rising urbanization, more people will have exposure to modern products and brands and thus shift to branded and packaged goods and products.
80% 70% 60% 50%
40%
30% 20% 10% 0% 2007 2015
Urban Rural
By 2015, An additional 25 million consumer will have moved into cities, not only buying FMCG for themselves but also serving as a conduit for information and goods for their families still in rural India.
Source: Technopak Analysis
700
600 535 410
500
400
300
200
100
0 Year 2008
Source: Technopak Analysis
Year 2013
Year 2018
Low Labor Cost: India has by far the lowest labour cost compared to many emerging countries giving it an edge for establishing manufacturing base for both Domestic and International FMCG brands. Average labourcost in India is ~US$ 90/month compared to US$190/month in China, US$ 210/month in Thailand and even higher US$1,300/month in Taiwan.
188
210
increasing capacity through increasing tracks, improving existing tracks and adding more freight compartments to enable better carrying of goods and products.
Challenges:
There are many challenges faced by the FMCG sector in todays world. In India there are many complicated policies and regulation, by the government, which are very difficult to follow and also structure of the market is totally different from comparison to other well developed countries. Here are some key challenges which are faced by the FMCG Sector in India are:1. Tax Structure - Complicated tax structure, high indirect tax, lack of uniformity, high octroi & entry tax and changing tax policies. 2. Infrastructural Bottlenecks - Agriculture infrastructure, power cost, transportation infrastructure and cost of infrastructure. 3. Counterfeits and Pass-offs 4. Emergence of Private Labels 5. Regulatory Constraints 6. Price of Inputs
1.Tax Structure: i. Complicated Tax Structure - In India, problems are exacerbated by the complicated tax structure. There is a VAT which is to be levied at state level, there are other state taxes such as octroi and entry taxes and then centre levies excise duties and service tax. As a result, no product cost is exactly the same from one state to the next. ii. High Indirect Tax - Indirect Tax levels are quite high, especially in light of the fact that the sector provides goods meant for daily consumption. China, for instance, levies a tax of 10%(Source: Mr.RajanVerma, CFO, Dabur India Ltd) on average,whereas in India, the average is around 30%. iii. Lack of uniformity - Despite VAT states does not implement rates and procedures uniformly. Each state still continues to approach taxation differently, and thus moving goods from one state to another is like moving them from one country into another. The taxation rate policies on many FMCG goods differ from state to state and centre to state. Centre has classified many FMCGproducts under Merit (VAT exempt) list, such as processed foods, tooth powder, sanitary napkins but states levy on the same products high rate of 12.5%(Source:Mr. Krishnan S, Parle Agro). iv. High Octroi& Entry Tax - There are Octroi and Entry Tax at city and state entry points in a few states, which leads to an increase in pricing and affords opportunities for arbitrage. For instance, Mumbai has octroi of 4-6% on goods produced outside of Mumbai. Thus, a bottle of mineral water produced by Coke or Pepsi which have their plants in Thane, which is considered outside the city limits of Mumbai, have to pay this extra charge, while Parle, which has a bottling plant within the city limits does not. So Bisleri is sold in Mumbai for Rs. 12, while Kinley or Aquafina cost Rs. 13,just because of the factory location. This opens up possible arbitrage opportunities, apart from causing a genuine grievance to the consumer. v. Changing Tax Policies - Tax policies keep changing which makes it difficult to plan for the long term. For instance, tax havens were created in J&K some years ago and many companies opened facilities there. However, recently part of the exemption was withdrawn by the government, thusleading to a sudden hike in costs.
2. Infrastructural Bottlenecks: i. Agricultural Infrastructure - Agriculture infrastructure in India is particularly weak. Firstly, irrigation and modern farming methods are not widespread and thus agriculture in India is at the mercy of nature. Thus, it makes for grossly varying amounts of harvest of critically needed inputs into FMCG manufacture, from one season to the next and one year to the next. ii. Power Costs - Power costs in India are very high and they contribute substantially to cost of goods sold. They are 3-4 times the optimal costs. iii. Transportation Infrastructure - To compound this problem is the poor transportation and roadways infrastructure many of the villages are extremely poorly connected with means of transportation either road, rail or sea so the amount of time it takes for the harvest to be transported to the FMCG manufacturers is unpredictable, and results in substantial spoilage of the goods. For example, it costs nearly 12 days to transport goods from Baddi in Himachal Pradesh to South India, a distance of 3000 km. The lack of a cold chain adds to this problem, because it means a tremendous amount of farm output actually rots or gets spoiled in transit. Nearly 8% -10% of dairy produce is lost to pilferage. iv. Cost of Infrastructure - It takes almost Rs. 7- 8 crores to lay 1km. of road. Along with this problems in land acquisition due to fragmented land holding further delay development of road and rail infrastructure increasing the cost associated. 3. Counterfeit and Pass-offs: Counterfeit products are another issue for the FMCG sector. Taking advantage of the lack of literacy and consumer knowledge, several small manufacturers churn out spurious products which they label akin to the big brands, Lifebuoy or Lax soap or Fivestar chocolate bars, Vicky balm, for instance. Thesespurious pass off products affect large, high quality brands which have actually invested money in research and development to create their products and build brand equity. These account for almost 10% - 15%(Source:ICCI-BPC initiated ORG study)of the total sector revenue and pose serious challenge to its growth and also impact governments tax revenue significantly. But the only recourse available to FMCG manufacturers against counterfeit and pass off products is to file an FIR. There are no Bureau of Industrial Standards norms laid out for each product category which could help prevent the mushrooming of counterfeit products. And an FIR results only in local action, if at all, while the source of the counterfeit products continues to remain in existence. 4. Emergence of Private Labels: Apart from the pressure on margins, the biggest fear of FMCG players when facing MR is the introductionof private labels or own brands. The fear is justified because world over, private labels have served to lower the consumers price points, particularly at the mass level. Moreover, there are inevitable conflicts of interest when a retail chain has its own label whose packaging looks like category leaders and stocks brands of other manufacturers, in terms of display space, promotions etc. A Technopak analysis undertaken across product categories revealed that private labels could constitute as much as one fourth of all sales in the FMCG category by 2011. While the exact year could shift marginally, there is no denying the fact that private label FMCG goods will be here and will constitute a formidable threat to add to the already fierce competition in the FMCG category. Brands which currently appeal to price conscious value shoppers will be facing the highest risk with advent of store brands. 5. Regulatory Constraints i. State borders cause a lot of delays and it is common for 2-3 days of finished goods inventory out of 20 -30 days total stuck on various state borders due to a requirement for multiplicity of permits and licenses.
ii. The Indian labour laws were drafted in the 1940s and take no note of modern manufacturing methods and strategies. They need to be changed on a more dynamic basis to reflect present realities. iii. There is lack of uniformity in definitions, and these do not follow international norms either. Currently, drugs and cosmetics come under the same set of laws when in fact they need to be treated differently. Weights and Measures used under FDA do not conform to those under the Weights and Measures Act followed in India. Some products come under the OTC category internationally but come under Schedule H drugs in India, requiring doctors prescription and require to be distributed only in drug licensed stores iv. Acquiring manufacturing licenses is a long and painful process, beset with red tape and corruption. It takes 10-12 months to get multiple licenses and to set up a manufacturing unit. v. Reservation of jobs for employees creates many problems. For instance, Himachal Pradesh has a reservation of 70% of jobs for people domiciled in Himachal Pradesh. Since they are few in number, attrition happens for as little as Rs. 50 pm, and it becomes a problem to maintain the requisite labour force. vi. Export procedures are cumbersome and lengthy. There is no single-party interface so multiple departments and officers have to be followed up with to get the requisite licenses. A transport permit has to be sourced for each consignment rather than assigning a blanket permit for a period of time. vii. Subsidies are announced by the government but to avail of them is both confusing and time consuming. a. Firstly, the amount of subsidy is restricted to Rs. 50 lakhs, regardless of the total quantum of investment required by a project. Thus, if large projects and small get the same incentives, large projects may not find takers. b. Secondly, the release of the said monies is not time-bound and gets done in an ad-hoc basis. 6. Prices of Inputs: i. Commodity prices fluctuate, which make it difficult to finalise raw material prices, affecting the final price of the product. The petroleum price fluctuation also impacts the cost of supply of materials.As a result, the entire supply chain dynamics need to be constantly planned afresh with the changing prices. ii. Indian consumers are more price-sensitive and value conscious, making it difficult for FMCG firms to pass on the inc
FMCG TRENDS
Introduction
India is changing rapidly as a society and as a consumer culture. An understanding of these changes and the causes behind them will be key to success for a FMCG player in India, so as to focus on the key trends, product categories and consumer segments, to profit the most from the positive economic climate. Features and benefits - India specific insights that help derive a richer appreciation of the nature and direction of Indian consumerism - Tracks seven key trends that will define the Indian FMCG industry's growth trajectory, in terms of product, market and consumer-related aspects - Insights from an annual consumer survey among Indians respondents, coupled with macroeconomic indicators, to showcase market potential Facts & Future Fast moving consumer goods will become a Rs 400,000-crore industry by 2020. A Booz & Company study finds out the trends that will shape its future Consider this. The anti-ageing skincare category grew five times between 2007 and 2008. Its today the fastest-growing segment in the skincare market. Olay, Procter & Gambles premium anti-ageing skincare brand, captured 20 per cent of the market within a year of its launch in 2007 and today dominates it with 37 per cent share. Who could have thought of ready acceptance for anti-ageing creams and lotions some ten years ago? For that matter, who could have thought Indian consumers would take oral hygiene so seriously? Mouth-rinsing seems to be picking up as a habit mouthwash penetration is growing at 35 per cent a year. More so, who could have thought rural consumers would fall for shampoos? Rural penetration of shampoos increased to 46 per cent last year, way up from 16 per cent in 2001. Consumption patterns have evolved rapidly in the last five to ten years. The consumer is trading up to experience the new or what he hasnt. Hes looking for products with better functionality, quality, value, and so on. What he needs is fast getting replaced with what he wants. A new report by Booz & Company for the Confederation of Indian Industry (CII), called FMCG Roadmap to 2020: The Game Changers, spells out the key growth drivers for the Indian fast moving consumer goods (FMCG) industry in the past ten years and identifies the big trends and factors that will impact its future. The report estimates the FMCG sector witnessed robust year-on-year growth of approximately 11 per cent in the last decade, almost tripling in size from Rs 47,000 crore in 2000-01 to Rs 130,000 crore now (it accounts for 2.2 per cent of the countrys GDP). Growth was even faster in the past five years almost 17 per cent annually since 2005. It identifies robust GDP growth, opening up of rural markets, increased income in rural areas, growing urbanisation along with evolving consumer lifestyles and buying behaviours as the key drivers of this growth.
The report further estimates that the FMCG industry will grow at least 12 per cent annually to become Rs 400,000 crore in size by 2020. Additionally, if some of the factors play out favourably, say, GDP grows a little faster, the government removes bottlenecks such as the goods and services tax (GST), infrastructure investments pick up, there is more efficient spending on government subsidy and so on, growth can be significantly higher. It could be as high as 17 per cent, leading to an overall industry size of Rs 620,000 crore by 2020.
As per the report titled 'The Indian Consumer Sector: What's the deal?', it established that Indian corporates will continue to seek out acquisitions in overseas markets. "While the slow growth and mature profile of western markets is unlikely to be appealing, Indian companies are likely to continue to focus on high growth markets such as South-East Asia, Africa, Latin America," the report added. Acquirers can gain significantly from choosing to follow an inorganic growth route, said PwC. There is an opportunity to gain market share and footprint in other fast growing countries/regions through acquisitions and also access to an established and well invested distribution infrastructure capable of leveraging existing products that will be adaptable to the new geography, the report added. Example :companies that were active in acquisitions Indian FMCG companies have been active in overseas acquisitions with the likes of Godrej and Wipro taking the lead. While Godrej had made a series of acquisitions in the past three years in Indonesia, Africa and Argentina, Wipro Ltd acquired Singapore based LD Waxon, which sells skincare and healthcare products, in December 2012. Wellness and beauty company VLCC acquired Malaysia's Wyann International in November, 2012. On the other hand, multinationals have also been in M&A activities in India. After acquiring Ahmadabadbased FMCG firm Paras Pharmaceuticals in 2011, Reckitt Benckiser had sold part of it homegrown firm Marico Industries
Conclusions
This sector will continue to see growth as it depends on ever increasing internal market for consumption and demand remains more or less constant, irrespective of recession or inflation. Hence the sector will grow though it may not continue at same pace, due to the present worldwide economic slowdown, rising inflation and fall of rupee. The sectors hiring will continue to remain robust. A look at some sectors that will drive growth in this sector:
Increasing rate of urbanization, expected to see major growth in coming years. Rise in disposable incomes, resulting in premium brands having faster growth and deeper penetration. Innovative and stronger channels of distribution to the rural segment, leading to deeper penetration into this segment. Increase in rural non-agricultural income and benefits from government welfare programs. Investment in stock markets of FMCG companies, which are expected to grow constantly.