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Tag: Inflation

  • A third of consumers borrow money or use savings to cover the costs of media subscriptions in UK: KPMG

    A third of consumers borrow money or use savings to cover the costs of media subscriptions in UK: KPMG

    Mumbai: KPMG statistic reveals that nearly a third (29 per cent) of people have borrowed money or used their savings to cover the cost of media subscriptions since the beginning of 2022. 17 per cent of consumers stopped subscribing to a video streaming service to pay for higher food bills this year. Over a third (35 per cent) of respondents said that the number of subscriptions they pay have increased during the pandemic, but 64 per cent are now cutting back because they are worried about the general increase in the cost of living.

    Almost a third (29 per cent) of individuals have struggled to pay for their media subscription services since the start of 2022, with people needing to borrow money or use savings to pay their bills, according to new KPMG research. The survey of UK consumers conducted by OnePoll found that 15 per cent have missed or defaulted on a payment for a media subscription service in the last three months.

    Many media companies have also been affected by rising costs, which they have had to pass on to their customers. The data revealed that consumers have seen their bills for all media subscription services rise this year. 60 per cent of people have seen their mobile phone bills increase. 74 per cent have had their TV subscription bill go up; 68 per cent are paying more for a video streaming service; and 71 per cent have seen a rise in the cost of a music streaming service.

    When asked why they were cancelling media subscriptions, nearly half (48 per cent) said it was because the company put their prices up and it became too expensive.

    The cost-of-living crisis is also having an impact: two-thirds of consumers (64 per cent) said they are decreasing the number of media subscriptions they pay for because they are worried about the general increase in the cost of living and want to save money. This was the primary reason given by all age groups.

    Many people have stopped subscribing to some services to pay for higher food bills this year, which are expected to rise at a rate of 15 per cent this summer, according to the Institute of Grocery Distribution2: Due to rising food prices, 19 per cent have given up a video streaming service, 15 per cent have dropped a TV provider, 14 per cent have stopped paying for a music streaming platform, and 15 per cent have cancelled a mobile contract.

    KPMG UK head of TMT Ian West said, “While consumers and media companies alike are feeling the pinch, organisations’ customers will value them in the long term if alternative payment options or plans can be introduced to help them continue to use their services – especially for essentials such as mobile phones. Unfortunately, the current crisis is unlikely to disappear anytime soon, and I hope that this industry adapts to support their customers in times of difficulty.”

    Focusing on younger age groups, they were found to have the highest number of subscriptions and pay the most in total for their combined media subscription services:

    At the beginning of the year, 18–24-year-olds had on average 21 different media subscriptions, whereas the over-65s had just 13.

    19 per cent of 18–24-year-olds are spending £151–£200 per month, compared to just 3 per cent of 55–64-year-olds and 5 per cent of those over the age of 65.

    Therefore, this younger group is more exposed to fluctuations in prices, which could explain why three quarters (74 per cent) of 18–24-year-olds are planning to end a subscription in the next six months, while only 21 per cent of those aged 55–64 and 32 per cent of those aged 65 and over think they will do so.

    Price increases are disproportionately affecting the young; in the case of mobile phone bills, 90 per cent of those aged 18 to 24 have seen their monthly bill increase this year, compared to 39 per cent of those aged 55 to 64.

    With video streaming services, 90 per cent of the 18–24 age group have seen an increase in their monthly payments, compared with 41 per cent of 55–64-year-olds.

    KPMG UK head of consumer markets, leisure and retail Linda Ellett said, “It is evident that younger age groups will cut back most on their media subscriptions. This can be partly attributed to the fact that they are likely to have a comparatively lower disposable income than other demographics, and typically exhibit less loyalty and more switching in other purchasing behaviours. It’s also evident that younger age groups have more subscriptions and were spending higher amounts in the first place, meaning they have greater flexibility in being able to make changes to save money.”

    Other key findings include:

    Video streaming companies are most vulnerable to a drop in subscriber numbers, with over a fifth (22 per cent) of consumers saying they will reduce the number of these services they pay for in the next six months.

    This figure was 18 per cent for TV providers, 16 per cent for music streaming and 14 per cent for mobile phones.

    Analysing how much people are cutting back overall, 8 per cent have reduced their monthly spend on media subscription services by £1–5; 18 per cent have cut it by £6–10; 12 per cent have cut back by £11–15; and 5 per cent said they have reduced their bills by £16–20 per month.

    West added, “The dip in subscriber numbers seen so far is merely the tip of the iceberg. The data reveals that since the start of the year, consumers have been paying for roughly the same number of media subscription services, with the average number declining from 14.2 to 14 overall. Clearly, people haven’t scrapped too many services yet, but are likely to do so in earnest in the second half of 2022.”

  • We have addressed inflation concerns by understanding the needs of the consumers: GCPL CMO Somasree Bose Awasthi

    We have addressed inflation concerns by understanding the needs of the consumers: GCPL CMO Somasree Bose Awasthi

    Mumbai: Godrej Consumer Products Ltd (GCPL) on Tuesday unveiled Godrej Magic Bodywash, a ready-to-mix bodywash that aims to offer consumers a bodywash experience at the price of a soap, while ensuring it is eco-friendly by encouraging the habit of “reuse and reduce.” Actor Shah Rukh Khan has been roped in as the brand ambassador for the product and will feature in a mass awareness campaign.

    In 2018, under the ‘Magic’ portfolio, the Godrej Group’s FMCG arm launched its powder-to-liquid handwash, Godrej Magic Handwash. The bodywash is the second addition to the ready-to-mix category with which the brand hopes to empower people to make a sustainable choice for their daily life activities.

    The company also pledged Rs 100 crore to be spent over the next three years towards mass awareness initiatives endorsing the message of an environment-conscious lifestyle along with social initiatives.

    On the sidelines of the event held at Mumbai, IndianTelevision.com had an exclusive interaction with Godrej Consumer Products Ltd (GCPL) India chief marketing officer Somasree Bose Awasthi to know more about the FMCG’s sustainable initiative and what it hoped to achieve through it, both in the short as well as long terms. Awasthi also highlights the company’s plans to extend the concept of the ready-to-mix format across its other product categories, such as liquid detergent.

    A Godrej group veteran, Awasthi completes two decades at the conglomerate, having joined as a management trainee in 2003 and working her way up. She was appointed as GCPL associate vice president-marketing (personal care) & aircare in 2014 and elevated as the chief marketing officer (India) in October 2021.

    She also discusses the steps Godrej Consumer is taking to mitigate the effects of soaring inflation on the FMCG sector as a whole, as well as its marketing strategy and whether the company has reduced its AdEx and/or marketing spends to protect its bottom line in the current uncertain market conditions.

    Edited excerpts…

    On launching a new product category at a time when most FMCG companies are cost-cutting and postponing or putting on hold new launches due to rising inflation.

    Awasthi: Actually, the timing itself was an inspiration for us to launch this product. As you rightly pointed out, because of inflation, prices are only going up. Today, a 200 ml body wash would cost anywhere between Rs 100 and Rs 200, and people are possibly dropping the category. This was the time when we thought that if we cut down on the “low-utility items” (of the product), can we bring down the cost? It may sound like an oxymoron that at a time like this, we talk about reducing costs. But we realised that there was this formulation which allowed us to reduce plastic to only 16 per cent, reduce fuel to less than half, and reduce energy to just 19 per cent compared to the current body wash. Then we went right to the root and put in our margin, etc., and we realised that we could actually give it to the consumers at one-third of the cost (of a bodywash) and actually at the cost of a soap!

    So, for someone who wants to upgrade from soap to bodywash for a better experience (because it is usually softer on the skin than soap), but is unable to do so due to the inflationary pressure of rising prices, we are offering this at the price of soap.

    Thus, the timing was just right in terms of both the inflationary pressure, which we handled, while also making it environmentally sustainable.

    On whether the FMCG company hopes to target the youth and form a connection with the youth consumer segment through this “sustainable” outreach.

    Awasthi: Today, right from the youth to everyone, talks about wanting a better earth. Everybody’s aware of the climatic conditions, global warming, etc. Without a doubt, the youth enters the picture because they have strong opinions and questions about everything. This is something that they care about, so yes. But is youth the only target? No! Our TG is the changing mindset of every consumer group. Hence, this product that uses less plastic, energy, and fuel is for all those who believe that this behaviour change is critical.

    On whether the brand would look to expand the ready-to-mix concept across its other product categories, like liquid detergents.

    Awasthi: So, we have done this in the handwash category in 2018 with the powder-to-liquid handwash. Now, three to four years after that, we have incorporated it into the body wash category. And more is coming, but for that we’ll have to wait and watch.

    On addressing the challenges posed by soaring inflation in the FMCG sector, such as increase in input costs, fuel price increase, shipping costs, and so on.

    Awasthi: What we have done is try and keep the consumer at the heart of our efforts to tackle inflationary pressures. And that’s how this new product development happened. If I talk about other categories, like hair colour, for instance, we realised that people want to use the better quality of hair colour with the crème, but are unable to do so because it comes at a price of Rs 30 plus. So we launched a smaller sachet priced at Rs 15. Thus, in this inflationary environment, the smaller packet helped retain consumption behaviour without denting the pocket.

    Similarly, in other categories like soaps, we have been careful to not completely pass on the inflation to the consumer. We have also taken a hit, but we have ensured that we do not tamper with the quality of the soap.

    Thus, we have addressed the inflation concerns by understanding consumer needs at such a time. Firstly, by reducing the price, or by coming up with smaller sachets, or else by passing on some part of the inflation but not the full burden of it onto the consumer and by launching innovations like this. So there are a plethora of activities that we have undertaken to ensure that people can still afford and access our products. And this is the reason why we have been able to sustain our market leadership and also the consumer’s goodwill.

    On the overall market outlook on the FMCG sector currently- have the market conditions improved in the face of macro uncertainty and inflation?

    Awasthi: Inflationary pressures continue, and that is making us, the marketers, think differently. In the boardroom, the discussions are always around how we can ensure consumption continues. And that’s where these strategies are coming from. In such an environment where people are being very careful about what they spend, how do you ensure that your share in that pocket doesn’t come down? Hence, strategies like those spelled out earlier—reducing the product quantity, making it affordable, not touching the quality but absorbing some of the pressure, and hoping that consumers are not negatively impacted and are still able to get access to them. That’s what we are trying to do.

    On the effect on Adex, has there been a dip in the resources allocated towards advertising & marketing spends

    Awasthi: We are proud to say that we have continued launching our products and have been repositioning our advertisements. In fact, we have been adding to our advertising expenses by investing in newer products. For example, we recently shifted our Goodknight positioning from efficacy-led campaigns to a “full night’s sleep” campaign. The highlight of that campaign is the amazing bond that the father and child share and how he tries to ensure that the baby’s sleep is not disturbed. It has made it to some of the top ads recently.

    We also invested in a new category altogether. We used to advertise the toilet variant. Now we have started advertising for the aer-matic, the automatic fragrance diffuser. We are the first brand to start advertising in mass media for this premium product category (priced at Rs 570). Because even in today’s uncertain environment, there’s a certain kind of lifestyle that people want to have. It’s for those premium consumers’ benefit-seeking campaigns that we have launched this campaign.

    We are also advertising the smaller sized sachets of hair dye through Anoushka Sharma. Thus, we have relaunched, launched new products, and started new campaigns. So overall, the ATL expenditure has only gone up for us. What we believe is that at this point in time, the consumer is super-conscious of where he’s putting his money. So, if our brand is the one that is present-giving the right, relevant message to the consumers, we will get picked up. And we are seeing the fruits of that.

    On optimising the company’s advertising expenditure, which medium sees the major portion of the advertisement pie? Also, have there been any changes in ad spend allocation in the last two years since the pandemic?

    Awasti: We are chasing the consumer where they are. So we are present across 360-degree media, whether it is television, whether it is increasing investment in digital, whether it is going on print or on outdoor media. What we’re doing is segmenting the market by consumer profile and investing where we can reach the most relevant consumers. And that’s the whole strategy because every product is different.

    On changes in adspend post-pandemic, I would say, yes, there’s been a rise in the way we spend beyond television. Digital obviously has been a rightful candidate because more and more people have shifted to digital quite a bit during the pandemic, and that’s one place where we have raised our investment. Apart from that, we are doing quite a bit of print, quite a bit of outdoors etc. As I said, wherever we are getting maximum reach for our TG we are there.

    On tackling emerging competition from D2C brands in the personal care sector and marketing strategies to enhance penetration.

    Awasthi: The marketing strategy is very simple. It’s like the basics of marketing: understand the consumer’s needs in each of the categories that we are present in and, possibly, even not present in but seeing a trend. And enter the newer markets with products that are differentiated and relevant to consumers. That would be our objective. And for products where we are already leaders and doing well, that’s where we would be investing very hard to maintain our leadership.

    The emerging D2C brands are still in a very niche space, I would say, with the economy today still limited to a few. Of course, it’s growing and we have to take cognisance of it. But having said that, at the moment it’s still the general trade which is ruling the roost and that’s where Godrej has the power of distribution.

    The majority of Indian consumers still prefer to interact with their friendly neighbourhood kirana and to touch & feel a product before purchasing it. So as of now, we still have that strength. But yes, D2Cs are an emerging segment, and as and when we see fit, we will adapt our strategy to the changing environment.

  • How are inflation-hit FMCG players protecting their bottom lines?

    How are inflation-hit FMCG players protecting their bottom lines?

    Mumbai: The domestic fast-moving consumer goods (FMCG) industry has been feeling the impact of unprecedented inflation for several quarters now. The unexpected rise in commodity prices, whether in food, chemicals, or packaging, combined with the spike in fuel prices, exacerbated by increased logistics and shipping costs, is putting pressure on FMCG companies, including packaged food companies, while also reducing the share of buyer income available for spending on consumer staples. As the market continues to witness an incremental increase in inflation, it’s not only the consumers who are feeling the pinch, but also the manufacturers, leading to a downgrading of sales across urban and rural areas.

    With no respite in near sight, how are the FMCG players dealing with the situation? How are brands resorting to innovative ways to mitigate the rise in input costs and deal with the soaring inflation?

    Most of the FMCG companies have increased prices of the products, says Kantar South Asia Insights Division managing director Soumya Mohanty. “So, it’s actually the end consumer who is feeling the pinch most. As a result, they are rationalising spends.”

    Findings from the latest Kantar Global Issues Barometer report indicates for 74 per cent of Indians, the increasing cost of living and other issues of concern are having an impact on their big life plans. “Customers are however unwilling to cut their spending on essentials, it’s the large ticket high value items which are most likely to bear the brunt most,” notes Mohanty. “We expect brands to optimise their portfolio to rationalise the cost of production and pass on the benefit to consumers.”

    Inflation’s impact can’t be “dealt with,” says White Rivers Media co-founder and CEO Shrenik Gandhi. This is why industry leaders are implementing changes that they hope will mitigate the said impact, he adds, pointing out some cost-saving initiatives that major FMCG players have begun implementing.

    Can “shrinkflation” be a solution?

    Among these methods is “shrinkflation,” which has been adopted by several major manufacturers, including Hindustan Unilever, Nestle, Dabur, P&G, Coca-Cola, and Pepsico. According to news reports, Haldiram has cut down the size of its aloo bhujia packet to 42 gm from 55 gm.
    HUL, Nestlé, Dabur, Marico, ITC, and Britannia have rolled out price increases of between 5 per cent and 20 per cent since October last year. Dabur India has introduced a mix of pricing actions and cost-control measures, even as companies across the board are using recycled aluminium for cans, cutting costs on advertising and marketing spends, and postponing new launches.

    According to Gandhi, some innovative ways FMCG brands are mitigating the rise in input costs and dealing with the soaring inflation are by investing in technology and digital initiatives to increase efficiency, introducing “bridge packs” as a strategy that gives slightly more grammage than the lower-priced pack while charging the customer higher, and by resorting to economical packaging and recycled products.

    “The Edelweiss report points out that FMCG companies are integrating systems across suppliers, inventory management, and distributor management, which were previously distinct systems in silos,” he noted. “Digital initiatives are being implemented across the board, from supplier onboarding and management to inventory management, distributor management to sales. Even if technology does not directly impact the end product, it will certainly play an increasingly important role in ensuring that it reaches customers faster and generates greater cost savings for these companies.”

    Increasing the price is not always an answer

    For FMCG and packaged food products, India has always been a very price-sensitive market, and the market volumes were at the lower end of the market, catering to the masses. In the Indian FMCG industry, smaller, single-use SKUs at price points of one rupee, two rupees, five rupees, and ten rupees are important.
    Hence, consumer companies are finding ways to increase prices without disturbing the grammage in the sensitive segments, priced less than Rs 10, and also protect margins at the same time. For fear of undermining demand in this category, they are considering launching ‘bridge packs’ at a higher price.

    Some manufacturers are using thinner packaging to counter runaway costs in commodities, packaging, and freight. Parle Products is looking at savings from carton configuration—meaning, it is looking at ways to add more packets of biscuits or snacks per carton. Britannia has said the company is bringing in process automation to raise productivity, reducing the distance to market to reduce cost and provide fresh products to consumers, reducing wastage at the factory and in the marketplace, and moving to a target of using up to 60 per cent of renewable energy.

    Avalon Consulting partner Santosh Sreedhar agrees that increasing prices is easier said than done in India, which is “a highly price-sensitive” market. However, he adds that beyond a point, this becomes inevitable as commodity pressures increase. “For brands that are operating at these price points, it’s a challenge since the product is sold on price. “In the case of one fruit juice company we are in touch with, the sales dropped as much as 40 per cent when the price of their highest-selling SKU was increased from Rs 10 to Rs 12,” he mentioned.

    “In my view, in most products, the opportunity to further reduce pack size is low as the companies have maxed out the potential. So, we may see companies now trying to move up the price point. We have already seen this happen in confectionery and shampoos more than a decade ago when 50p products moved to rupee one. There was a temporary dip in sales for many brands, but eventually, the market settled down at the higher price point,” he added.

    He lists out the following options for FMCG companies if they have to retain margins, apart from increasing prices: reduce pack sizes; change product formulation; reduce packaging/packaging reengineering. Changing product formulation is very much a possibility, but may not be applicable in many product categories, says Sreedhar. “We are not expecting at least the top brands to change the composition, but companies can come up with lower priced variants that help them continue to serve customers at lower price points. Many of the shampoo and chocolate brands have done this in the past where the product in the larger SKUs is different from the ones in the smaller SKUs.”
    According to Pescafresh founder Sangram Sawant, the quality and freshness of the product, remaining non-negotiable factors, do pose a double challenge for the brand to ensure cost optimisation across functions and efficiency. He said, “Just-in-time inventory, reducing shrinkage, maintaining cold chain across the supply chain links, and introducing technology stacks to reduce the supply chain hurdles have helped us offset a few cost increases.” The brand has currently not decided to hike prices. However, if its procurement costs continue to rise, it will “take a call accordingly.”

    The Impact on AdEx?

    Will the current scenario warrant a decrease in Advertising spends by brands, as marketing costs are known to one of the first to take a hit in uncertain times?

    Sawant says that with the introduction of Pescalive, the seafood e-supplier is innovating across the supply chain and marketing functions to control costs. With regards to ad spends, the brand is in the process of building Pescafresh as an overall foodtech brand and will continue to focus on the same for the fiscal, he adds.

    Whenever there is uncertainty, consumers need reassurance, and they fall back to familiar and known options, observes Kantar’s Mohanty. So, it will be key for the brands to stay true to their core purpose and talk to consumers about it. For this to happen, communication is going to be important. So, visibility on different medias- TV, Social media will be important and Ad expenditure is unlikely to get reduced, he believes.

    Bombay Shaving Company COO Deepak Gupta is optimistic on the impact on Adex as well. Marketing spends is a function of number of units sold, contribution margin and marketing effectiveness, he notes. “For premium brands on a growth trajectory, current situation provides a unique opportunity as reduced ad expenditure from incumbent brands is leading to higher SOV (Share of voice), and lower CPMs (cost per mille) without increasing absolute ad spends.”

    “We are increasing our ad spends on key categories with a channel focus to improve TOMA (top-of-mind awareness) and enter into consideration set of prospective buyers. Overall, we expect higher marketing investment from FMCG brands in second half of the year, considering the onset of festive season and easing of inflationary pressures,” he adds.

    While mass FMCG brands are resorting to price increase, volume reduction (or both) and cut in marketing and other discretionary spends, for premium brands the effects have been less pronounced as target consumers for premium grooming products are less price sensitive.

    According to Deepak Gupta, the brand has been able to grow by investing in strengthening brand equity and maintain gross margin by reducing discounts, promotions and other discretionary spends. 

    He takes a more optimistic outlook on the long-term impact of the inflationary trend. “In our view, July-August-September quarter bodes well for FMCG sector as inflation has peaked and festive season is expected to lead to demand revival. Count and intensity of Covid cases have also reduced considerably compared to previous quarters which will lead to incremental growth.” We do not expect any price hike or volume reduction as brands will invest to gain higher share of wallet, Gupta adds.

    New-age integrated sales and distribution SaaS platform FieldAssist CEO Paramdeep Singh Anand that connects CPG businesses to the broader value chain too holds on to a positive stance. “According to a recent report, the inflation rate in India is expected to reach five per cent by March 2023, that is a dip of two percentage points. Recently the government has asked FMCG companies to reduce cooking oil prices. Amidst these developments, it is difficult to say if inflation will rise further.”

    This is to give some respite to the CPG companies who have been dealing with the trilemma of raising prices, cutting margins or cutting corners, he adds. “It is clear that we have reached the saturation point where companies that have been reducing grams without impacting prices cannot do so anymore for having reached the threshold. A similar statement could be said of companies increasing prices. That leaves many with the option of adopting strategic moves to stay in the race.”

    Strategies such as using technology to identify “golden stores”, or the twenty percent stores that sell eighty percent of your products would help in optimising assortment, price, promotions and share of shelf, says Anand. “Another strategy could be optimising advertising costs by targeting new-age platforms to tap audience, for instance gaming sites, or utilising influencer marketing in untraditional ways. This will reduce expenditures and help utilize funds optimally,” he adds.

    Apart from reducing price and volume, FMCG brands are looking at each line of P&L to optimise cost. Reducing advertising spends, increased focus on hero SKUs to get scale advantages, premium product innovation, reducing consumer promos and discount, improving sales mix to deliver higher gross margins, allocating higher spends for more capital efficient channels and top customers etc are some of the additional ways that industry stakeholders cite to mitigate input cost pressures, other than supply side measures.

  • Inflation bites FMCG consumption, demand remains low

    Inflation bites FMCG consumption, demand remains low

    Mumbai: The major players in the FMCG sector, Marico and Godrej Consumer Products Ltd, hint that inflation continued to ‘hit hard’ FMCG industry and demand remained soft in the June quarter.

    According to Marico, current trends indicate that consumers “titrated consumption” in some non-essential categories and either “downtraded among brands or switched to smaller packs” in the essential categories.

    In its quarterly update for Q1 FY23 Marico said, “In the given context, India business volumes declined in mid-single digits. The performance was particularly dragged by a sharp drop in Saffola Oils. Excluding Saffola Oils, the India business posted marginal volume growth. Parachute Coconut Oil recorded a minor volume decline.”

    Marico said it maintains its aspiration of “delivering sustainable and profitable volume-led growth over the medium term”.

    According to Godrej Consumer Products Ltd (GCPL), the country’s FMCG industry continued to be “hit hard by inflation levels” leading to successive price hikes as well as impacting volumes during the three months ended June.

    A recent update revealed that in the first quarter of the current fiscal, the leading FMCG player said that the rural markets witnessed slower growth compared to urban markets during the period.

    GCPL expects to deliver early double-digit sales growth on a high base in India and the growth will be mostly “price-driven”. The company would have “mid-single-digit volumes drop on a high base, with a three-year volume compound annual growth rate (CAGR) close to mid-single digits,” in the domestic market.

    “The Indian FMCG industry continued to remain soft during the quarter. It continued to be hit hard by inflation levels aggravating due to geopolitical tensions, leading to successive price increases and impacting volumes,” GCPL said.

    Inflation impacts markets worldwide

    In recent months, inflation has been on the rise in most markets worldwide.

    Among the international markets, GCPL said that Indonesia, which is the company’s second-largest market after India, also faced an impact on consumption and margins.

    “In Indonesia, with hygiene performance waning after COVID-19 and a large hygiene comparator in base, we expect a high single-digit sales decline. The sales performance excluding hygiene was largely flat,” it said.

    GCPL said that it is putting building blocks in place to drive category development and general trade distribution to ensure gradual recovery in the medium term.

    “In Godrej Africa, USA, and the Middle East, we continued our growth momentum across most of our key countries of operations. We expect to deliver double-digit sales growth, with a continued focus on driving sustainable, profitable sales growth,” it said.

    Further, it expects constant currency sales growth in the high teens in Latin America business.

    “At a consolidated level, we continue to leverage our category and geographic portfolio. We expect to deliver high single-digit sales growth and a three-year CAGR in double-digits,” the company said.

    With respect to profitability in the June quarter, GCPL expects lower year-on-year EBITDA (Earnings Before Interest Tax Depreciation and Amortisation) margins.

    “This is due to input inflation, upfront marketing investments to drive category development and weak performance in Indonesia,” GCPL said.

    On the other hand, Marico’s international business maintained “strong momentum, delivering high-teen constant currency growth.” It experienced growth in all markets and managed to remain on the path of sustained profitable growth.

    The company expects “consolidated revenue in the quarter ended marginally higher on a year-on-year basis.”

    Dabur’s international business is expected to register a “high single-digit revenue growth” during the April-June quarter in constant currency.

    “Overall, the consolidated revenue is expected to grow in the mid to high single digits. We continue to grow ahead of category growths and gain market share in most of our segments,” Dabur said.

    Mixed performance in the domestic market

    In the domestic market, GCPL witnessed a mixed performance in its personal care and home care categories.

    “Personal care sustained its strong double-digit growth trajectory with a two-year CAGR also in double-digits, led by both personal wash and hair colours. Home care witnessed a low single-digit sales drop on a high base. However, the two-year CAGR remained at a high single-digit figure,” it said.

  • TRAI rationalises tariff for non-DAS areas, providing for inflation

    TRAI rationalises tariff for non-DAS areas, providing for inflation

    NEW DELHI: Meeting a long-felt demand, the Telecom Regulatory Authority of India (TRAI) has decided to allow the balance inflation linked hike both at the retail and wholesale levels, from 1 January 2015.

    The Telecommunication (Broadcasting and Cable) Services (Second) Tariff (Thirteenth Amendment) Order 2014 applicable for non-addressable (analogue cable TV) systems prescribes ceiling retail tariff on pan-India basis depending upon the number of pay and free-to-air (FTA) channels.

    The ceilings are Rs 117 per month for minimum of 30 FTA channels; Rs 234 per month for minimum 30 FTA channels and up to 20 pay channels; and Rs 292 per month for minimum 30 FTA channels and more than 20 pay channels.

     At the wholesale level, price ceilings will continue, subject to inflationary adjustments allowed from time to time.

    TRAI said the order was aimed at rationalising retail tariff and simplifying implementation. The Authority had undertaken a similar exercise in April 2014.