Market Segmentation
Fast moving consumer goods (FMCG) are the 4th largest sector in the Indian economy. There are
three main segments in the sector – food and beverages which accounts for 19 per cent of the
sector, healthcare which accounts for 31 per cent and household and personal care which
accounts for the remaining 50 per cent.
The FMCG sector has grown from Rs 2,20,852.4 crore (US$ 31.6 billion) in 2011 to Rs
3,68,669.75 crore (US$ 52.75 billion) in 2017-18. The sector is further expected to grow at a
Compound Annual Growth Rate (CAGR) of 27.86 per cent to reach Rs 7,24,759.3 crore (US$
103.7 billion) by 2020.
Accounting for a revenue share of around 45 per cent, rural segment is a large contributor to the
overall revenue generated by the FMCG sector in India. Demand for quality goods and services
have been going up in rural areas of India, on the back of improved distribution channels of
manufacturing and FMCG companies. Urban segment accounted for a revenue share of 55 per
cent in the overall revenues recorded by FMCG sector in India.
Market Size
The Retail market in India is estimated to reach US$ 1.1 trillion by 2020 from US$ 840 billion in
2017, with modern trade expected to grow at 20 per cent - 25 per cent per annum, which is likely
to boost revenues of FMCG companies. Revenues of FMCG sector reached Rs 3.4 lakh crore
(US$ 52.75 billion) in FY18 and are estimated to reach US$ 103.7 billion in 2020. The sector
witnessed growth of 16.5 per cent in value terms between July-September 2018; supported by
moderate inflation, increase in private consumption and rural income.
Future Growth
New production facilities are equipped with machinery to reduce the wastage of products during
production. Transport and infrastructure development are improving the methods of distribution to
even the remotest areas of India.
There are economical packages and one-time use packs for the people who have less spending
power or who want the ease of unit packs. With the latest packaging technologies, FMCG
companies are able to innovate and manufacture long-lasting products with the minimum damage
of packages during transportation.
Indian FMCG Market by Type
Food & Beverages: Food & beverages sector accounted for the largest share in India’s
FMCG market. The changing preferences of the upward middle class families from the
urban areas gave importance to food & beverages sector and thus, fuelled the growth in the
last few years. India is the world’s second largest producer of food, next only to China, and
has the potential of being the largest player in food and agricultural sector. The food
processing industry is one of the largest industries in India and is ranked fifth in terms of
production, consumption, export, and expected growth.
Leading FMCG Companies in Food & Beverages Segment along with key products: ITC -
Aashirvaad, Sunfeast, Bingo! Yippee! Kitchens of India, B Natural, mint-o, Candyman, Amul
- Amul Milk, Cheese, Ice Cream, Mithai Range, Chocolates, Butter milk, beverages, Parle -
Agro Frooti, Café Cuba, Hippo, Maaza, Parle-G, Melody, Mango Bite, Poppins, Kismi
Toffee Bar, Monaco and Krack Jack, Britannia Industries - Dairy products, Biscuits (Vita
Marie Gold, Tiger, Nutrichoice Junior, Good day, 50 50, Treat, Pure Magic, Milk Bikis, Good
Morning, Bourbon), breads, etc. Nestle Nescafé, Kit Kat, Maggi, etc.
Personal Care: Personal care products market in India is estimated to be worth USD9.91
billion in 2015. Personal hygiene products such as bath and shower products, deodorants,
etc., hair care, skin care, colour cosmetics and fragrances are the key segments of the
personal care market. Each of these segments exhibit their unique trends and growth
patterns. Favourable demographic factors and increasing consciousness among the
