Industry Overview

FMCG SECTOR

Scope in FMCG Sector including Personal Care Products
The overall fast moving consumer goods (FMCG) market is expected to increase at a compound annual growth rate (CAGR) of 14.7 per cent to touch US$ 110.4 billion in the period 2012-2020, with the rural FMCG market anticipated to increase at a CAGR of 17.7 per cent to US$ 100 billion during 2012-2025.

The market size of the Indian FMCG sector is expected to reach US$ 135 billion by 2020 from US$ 44.9 billion in 2013. It is also the fourth largest sector in the Indian economy and has grown at an annual average of about 11 per cent over the last decade. Food products, the leading market segment with 43 per cent of the overall market revenue together with personal care at 22 per cent make up two-thirds of the sector’s revenue.

The Government of India’s policies and regulatory frameworks such as relaxation of license rules and approval of 51 per cent foreign direct investment (FDI) in multi-brand and 100 per cent in single-brand retail are some of the major growth drivers in this sector.

There is a lot of scope for growth in the FMCG sector from rural markets with consumption expected to grow in these areas as penetration of brands increases. Also, with rising per capita income, which is projected to expand at a CAGR of 7.4 per cent over the period 2013-19, the FMCG sector is anticipated to witness some major growth. (IBEF, India Brand Equity Foundation Report October, 2014)

PERSONAL CARE PRODUCTS MARKET

Growing consumerism is spurring demand for personal care products, according to Frost & Sullivan’s new report, ‘Trends and opportunities in surfactants for personal care’.

  • The Personal care market in India can be segmented into Skin Care, Hair-Care, Oral Care including other smaller segments Low penetration in rural markets which constitute 70% of the population of the India presents a major opportunity for growth in this segment. A growing proportion of working women, aspirations of using international premium brands, growing awareness of men’s grooming products are all driving the consumption in the Indian personal care segment.
  • The skin-care market is estimated at $1.3billion. Skin care in India is still predominantly only facial care. Body and hand care products though are gaining momentum. Hindustan Unilever occupies 58% of market share in skin care. Other players have small shares. The segment has grown at a CAGR of 13% from 2000-12.
  • The bath and shower market in India includes bar soap, body wash, shower gel and talcum powder. Total Bath and Shower market size is estimated at $2.8 billion. Hindustan Unilever holds 50% market share in the segment followed by Godrej Consumer Products with 10%. The segment has grown at a CAGR of 8.7% from 2000-12
  • The hair-care market in India is estimated at $2.4 billion. Hair-care consists of shampoos, conditioners, hair oils etc. The segment has grown at a CAGR of 12% from 2000-12. Shampoo makes up 31% of the hair-care market, while, perfumed oil and coconut based oil make up 27% and 25% of the market respectively. Through the introduction of new products and increasing awareness the segment has the potential for high growth.
  • The oral-care market in India is estimated at $1.3 billion. Oral-care consists of toothpaste, toothbrushes, mouthwash and toothpowder. The segment has recorded a revenue CAGR of 8.3% in 2000-12, Colgate Palmolive has the dominant position in the market with a market share of 47%, followed by HUL with 19% and Dabur at 11% The home care market in India is estimated at ~$3.8billion
  • The household care segment can be further divided into the following sub-segments: Air Care, Dish-Washing, Toilet Cleaner, Laundry Care, Polishes, Insecticide, Surface Care etc. This industry segment is a volume driven market with low margins and is marked with stiff competition. Laundry care (detergents and bar) dominates the segment and is marked by high penetration in both Rural and Urban India
Dr Kleenz Laboratories Private Limited
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