Global operations came to the rescue of many an FMCG company in the September 2013 quarter.

At 12.5 per cent, sales growth for 14 listed fast moving consumer goods firms came in a notch higher than the 12 per cent growth for the June 2013 quarter.

But companies with a heavy presence overseas fared much better, benefiting from a demand pick-up as well as a weaker rupee.

Lotions and creams, as consumers stocked up for the winter months, propped up the skincare segment. Rural consumers loosened their purse strings even as their urban counterparts remained thrifty.

For companies such as Dabur, Emami, Godrej Consumer and Marico, overseas operations helped generate high sales growth.

For instance, Godrej Consumer’s overseas revenues grew 33 per cent in the September 2013 quarter, up from 30 per cent in June. Its domestic revenues slowed to 14 per cent.

For Godrej, sales of Keyline and Soft & Gentle cosmetics in the European region almost doubled, with an increase in market share and a new acquisition.

The company’s hair-care portfolio powered a 53 per cent growth in Africa sales.

For Dabur India, a turnaround in US operations and a good Turkish and West Asian performance delivered a 26 per cent international sales growth.

Another factor that played a big role in boosting revenues was the exchange rate.

For Marico, almost three-quarters of its 14 per cent overseas sales growth came in due to a favourable exchange rate.

Poor growth in troubled Egypt and sluggish Bangladesh were a drag, despite the healthier Vietnam market.

Domestic sales for most FMCG companies showed mixed trends.

Skincare sales, for instance, received a leg-up from the upcoming winter. Hindustan Unilever’s skincare segment clocked double-digit volume growth, thanks in part to Vaseline and Dove lotions selling well.

Emami, too, saw volumes for its Boroplus brand jump almost 28 per cent due to pre-season stocking.

Hair-care, for the most part, showed good growth. Godrej’s hair colour segment posted a second quarter of impressive value growth at 24 per cent. Value-added oils growing at 22 per cent compensated for the Parachute brand’s sedate performance for Marico.

Toothpastes sold well for Colgate Palmolive, Dabur and HUL, with all posting double-digit value growth.

Foods, despite being a nascent category, showed sluggish growth. Agro Tech Foods grew sales by just about 1 per cent while Nestle’s sales have held at 11 per cent for the past two quarters.

Ad spend up

But competitive intensity remained high, showing up in higher adspend for companies operating in crowded segments such as personal products.

Colgate-Palmolive, P&G Hygiene and HUL, have all seen a rise in their adspend-to-sales ratio in the September quarter compared to the June quarter.

Operating margins, though, have held steady due to lower raw material costs. Net profits for the entire set expanded by 14 per cent.

>bhavana.acharya@thehindu.co.in

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