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A RESEARCH REPORT ON ANALYSIS & ASSESSMENT OF FMCG MARKET OF INDIA

ACKNOWLEDGEMENT
We would like to express our sincere gratitude to _______________, for his inspiration and guidance towards penetration of this report. We are highly indebted to all those who provided us the stimulus of writing this project report on Analysis and Assessment of F !" arket of #ndia. We are grateful to ____________________________for their valuable advice, continuous support and guidance through various useful discussions at different stages of this work. A humble thanks are also due to ___________________for their useful suggestions and constant help in preparation of this report. We also acknowledge the whole staff at _________________office to render their whole hearted co$operation at times. %ur sincere THANKS are due to all of them. &hey all have been a constant source of inspiration to us throughout our summer training program. 'ast but not the least, a word of thanks to our entire faculty and staff members at our #nstitutes for their encouragement at any times.

&able of !ontents

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RESEARCH PROCESS IN FLOW CHART

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*,F#(, ),/,A)!0 -)%1',

)esearch encompasses activities that increase the sum of human knowledge. )esearch and ,xperimental *evelopment comprises<

!reative work undertaken on a systematic basis in order to increase the stock of knowledge, including knowledge of humanity, culture and society, and the use of this stock of knowledge to devise new applications. Any activity classified as research and experimental development is characteri=ed by originality> it should have investigation as a primary objective and should have the potential to produce results that are sufficiently general for humanity?s stock of knowledge @theoretical andAor practicalB to be recogni=ably increased. ost higher education research work would Cualify as research and experimental development.

)esearch carries with it a professional and ethical responsibility to disseminate and apply the results of research activity and to conduct research in a manner consistent with the Statement and Guidelines on Research Practice . An essential characteristic is that it leads to publicly verifiable outcomes which are open to peer appraisal. &he complementary activity of scholarship refers to possession of an extensive and profound knowledge of an academic discipline and the analysis and interpretation of existing knowledge aimed at improving, through teaching or by other means of communication, the depth of human understanding.

&ypes of )esearch Activity

)esearch includes pure basic research, strategic basic research, applied research and experimental development . Pure basic research is experimental and theoretical work undertaken to acCuire new knowledge without looking for long$term benefits other than the advancement of knowledge. Strate ic basic research is experimental and theoretical work undertaken to acCuire new knowledge directed into specified broad areas in the expectation of useful discoveries. #t provides the broad base of knowledge necessary for the solution of recognised practical problems.

A!!"ie# research is original work undertaken primarily to acCuire new knowledge with a specific application in view. #t is undertaken either to determine possible uses for the findings of basic research or to determine new ways of achieving some specific and predetermined objectives. E$!eri%e&ta" #e'e"(!%e&t is systematic work, using existing knowledge gained from research or practical experience, that is directed to producing new materials, products or devices, to installing new processes, systems and services, or to improving substantially those already produced or installed.

&he purpose of the research is to discover answers to Cuestions through the application of scientific procedures. &he main aim of research is to find out the truth which is hidden and which has not been discovered as yet.

Aim: Analysis and Assessment of Fast Moving Consumer Goods, which refer to things that we buy from local supermarkets on daily basis, the things that have high turnover and are relatively cheaper.

F%) +'A&, 02-%&0,/#/

A hypothesis is a specific statement of prediction. #t is simple> hypothesis is a suggested solution or explanation to a problem or a phenomenon. /o you will just write what you think is the solution to that problem. #t describes in concrete @rather than theoreticalB terms what you expect will happen in your study. (ot all studies have hypotheses. /ometimes a study is designed to be exploratory. &here is no formal hypothesis, and perhaps the purpose of the study is to explore some area more thoroughly in order to develop some specific hypothesis or prediction that can be tested in future research. A single study may have one or many hypotheses. #f your prediction specifies a direction, and the null therefore is the no difference prediction and the prediction of the opposite direction, we call this a one-tailed hypothesis. When your prediction does not specify a direction, we say you have a twotailed hypothesis The "( ic () h*!(thesis testi& is base# (& these t+( basic !ri&ci!"es,

&he formulation of two mutually exclusive hypothesis statements that, together, exhaust all possible outcomes &he testing of these so that one is necessarily accepted and the other rejected

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)esearch design is the controlling plan for a %ar-eti& research stu#* in which the methods and procedures for collecting and analysing the information to be collected is specified. )esearch design can be thought of as the structure of research $$ it is the 4glue4 that holds all of the elements in a research project together.

&ypes of )esearch *esigns

Ra&#(%i.e# e$!eri%e&t N(&/e$!eri%e&ta" #esi & 0uasi/e$!eri%e&ta" #esi &

We can classify designs into a si%!"e three)("# c"assi)icati(& by asking some key Cuestions. First, does the design use random assignment to groups5 D*on?t forget that random assignment is not the same thing as random selection of a sample from a populationEF #f random assignment is used, we call the design a ra&#(%i.e# e$!eri%e&t or true experiment. #f random assignment is not used, then we have to ask a second Cuestion< *oes the design use either multiple groups or multiple waves of measurement5 #f the answer is yes, we would label it a 1uasi/e$!eri%e&ta" #esi &. #f no, we would call it a &(&/e$!eri%e&ta" #esi &. A randomi=ed experiment generally is the strongest of the three designs when your interest is in establishing a cause$effect relationship. A non$ experiment is generally the weakest in this respect.

!%'',!&#%( %F *A&A ethods of primary data collection /emi$structured interview A unstructured interview Focus groups *iaries A written accounts -articipant observation A non$participant observation edia sources &hrough schedule Warranty cards *istributors or /tore audits -antry audits !onsumers panels +se of mechanical device -rojective techniCue

ethods of secondary data collection :arious publications of the central, state local governments :arious publication of foreign governments or international bodies and their subsidiary organisations )eports and publication of various associations )eports prepared by research scholars -ublic records and statistics, historical documents &echnical and trade journals (ewspapers aga=ines 1ooks

A(A'2/, *A&A
&his will be much more substantial, and much more discursive, than the results section of a typical experimental report. 2our purpose here is twofold $ you need to give an account of your data @to communicate a sense of Gwhat it is likeHB and to offer an interpretation of @to make a case for Gwhat it meansHB. &his should be based upon your codes andAor themes, but there is plenty of scope for you to be imaginative in both the way that you choose to structure your analysis section, and in the way that you choose to lay out your evidence. any of your decisions will depend on your chosen approach. 1y the time you get to the analysis of your data, most of the really difficult work has been done. #t?s much more difficult to< define the research problem> develop and implement a sampling plan> conceptuali=e, operationali=e and test your measures> and develop a design structure. #f you have done this work well, the analysis of the data is usually a fairly straightforward affair. #n most social research the data analysis involves three major steps, done in roughly this order<

C"ea&i& a&# (r a&i.i& the #ata )(r a&a"*sis Describi& the #ata Testi& H*!(theses a&# M(#e"s

2*ata -reparation3 2*escriptive /tatistics3 @#nferential /tatistics3

involves checking or logging the data in> checking the data for accuracy> entering the data into the computer> transforming the data> and developing and documenting a database structure that integrates the various measures.
Data Preparation

are used to describe the basic features of the data in a study. &hey provide simple summaries about the sample and the measures. &ogether with simple graphics analysis, they form the basis of virtually every Cuantitative analysis of data. With descriptive statistics you are simply describing what is, what the data shows.
Descriptive Statistics

investigate Cuestions, models and hypotheses. #n many cases, the conclusions from inferential statistics extend beyond the immediate data alone. For instance, we use inferential statistics to try to infer from the sample data what the population thinks. %r, we use inferential statistics to make judgments of the probability that an observed difference between groups is a dependable one or one that might have happened by chance in this study. &hus, we use inferential statistics to make inferences
Inferential Statistics

from our data to more general conditions> we use descriptive statistics simply to describe what?s going on in our data.

#(&,)-),& A(* ),-%)&

&he best advice is to consider your particular writing context carefully and to let it guide your writing. #f youHre writing in a workplace context, find out if your organi=ation has document or style guidelines and look at previous reports put out by the organi=ation. Whenever you write, you should keep your purpose and audience clearly in focus. 1egin by considering

what you want to accomplish with your report< what are your primary and secondary objectives5 who will be reading your report and for what purposes< What is their background5 What Cuestions might they have5 What might they expect in terms of content and format5

#(&)%*+!&#%( %F F !" A)3,&

INTROD4CTION &he #ndian F !" sector is the fourth largest sector in the economy with a total market si=e in excess of +/I JK.J billion.#t has a strong (! presence and is characterised by a wellestablished distribution network, intense competition between the organised and unorganised segments and low operational cost. Availability of key raw materials, cheaper labour costs and presence across the entire value chain gives #ndia a competitive advantage. &he F !" market is set to treble from +/I JJ.L billion in 677K to +/I KK.M billion in 67JN. -enetration level as well as per capita consumption in most product categories like jams, toothpaste, skin care, hair wash etc in #ndia is low indicating the untapped market potential. 1urgeoning #ndian population, particularly the middle class and the rural segments, presents an opportunity to makers of branded products to convert consumers to branded products. "rowth is also likely to come from consumer ?upgrading? in the matured product categories. With 677 million people expected to shift to processed and packaged food by 67J7, #ndia needs around +/I 69 billion of investment in the food$processing industry. Automatic investment approval @including foreign technology agreements within specified normsB, up to J77 per cent foreign eCuity or J77 per cent for ()# and %verseas !orporate 1odies @%!1sB investment, is allowed for most of the food processing sector.

4 WHAT IS FMCG5 4 F !"Hs or fast moving consumer goods are the products which are freCuently purchased by consumers including toiletries, soaps, cosmetics, teeth cleaning products, shaving products, detergents, other non$durables such as glassware, bulbs, batteries, paper products ,plastic goods etc. #t used to be called the grocery industry, now itHs just called F !". F !" is an ugly acronym for Fast Moving Consumer Goods , which translated into ,nglish means ?things you buy on a regular basis at places like your local supermarket. Sc(!e () the FMCG Sect(r &he #ndian F !" sector with a market si=e of +/IJK.J billion is the fourth largest sector in the economy. A well$established distribution network, intense competition between the organi=ed and unorgani=ed segments characteri=e the sector. F !" /ector is expected to grow by over L7O by 67J7. &hat will translate into an annual growth of J7O over a N$ year period. #t has been estimated that F !" sector will rise from around )s NL,N77 crores in 677N to )s P6,J77 crores in 67J7. 0air care, household care, male grooming, female hygiene, and the chocolates and confectionery categories are estimated to be the fastest growing segments, says an 0/1! report. &hough the sector witnessed a slower growth in 6776$677M, it has been able to make a fine recovery since then. For example, 0industan 'evers 'imited @0''B has shown a healthy growth in the last Cuarter. An estimated double$digit growth over the next few years shows that the good times are likely to continue. Rece&t De'e"(!%e&ts i& Fast M('i& C(&su%er G((#s 2FMCG3 Sect(r F !" sector is no doubt registering an up trend in growth. According to !(1!, F !" sector growth story will continue because of the positive budget. (evertheless, there are some barriers to the growth of the sector. #ndirect taxes constitute no less than KNO of the total cost of consumer products $ the highest in Asia. 'ast year, Finance inister proposed to introduce an integrated "oods and /ervice &ax by April 67J7.&his is an exceptionally good move because the growth of consumption, production, and employment is directly proportionate to reduction in indirect taxes.

6u# et 7889/788: )(r FMCG Sect(r )eduction of duty on edible oil will have a positive impact on positive for #&!, 1ritannia, and -arle. )eduction of custom duty on food processing machinery and their parts from 8.NO to NO. )eduction of excise duty on food mixes from JLO or 9O to nil is positive for #&!. *evelopment of rural infrastructure is in focus, which is beneficial for F !" companies because it is a big market for F !"s. 1etter infrastructure will improve the supply chain. ,xemption of free samples and displays from the purview of F1& will be beneficial for F !" companies because they spend huge amount of money on advertising and brand building. 0'', *abur, #&!, and the most benefited companies. arico will be amongst arico.

Full exemption of excise duty on biscuits priced at N7 rupees or less per kg is

&he #ndian F !" sector is the fourth largest sector in the economy with a total market si=e in excess of +/I JK.J billion. #t has a strong (! presence and is characteri=ed by a well established distribution network, intense competition between the organi=ed and unorgani=ed segments and low operational cost. Availability of key raw materials, cheaper labour costs and presence across the entire value chain gives #ndia a competitive advantage. &he F !" market is set to treble from +/I JJ.L billion in 677K to +/I KK.M billion in 67JN. -enetration level as well as per capita consumption in most product categories like jams, toothpaste, skin care, hair wash etc in #ndia is low indicating the untapped market potential. 1urgeoning #ndian population, particularly the middle class and the rural segments, presents an opportunity to makers of branded products to convert consumers to branded products. "rowth is also likely to come from consumer ?upgrading? in the matured product categories. With 677 million people expected to shift to processed and packaged food by 67J7, #ndia needs around +/I 69 billion of investment in the food$processing industry.

WHY INDIAN MARKET Lar e D(%estic Mar-et #ndia is one of the largest emerging markets, with a population of over one billion. #ndia is one of the largest economies in the world in terms of purchasing power and has a strong middle class base of K77 million.

Around 87 per cent of the total households in #ndia @J99 millionB resides in the rural areas. &he total numbers of rural households are expected to rise from JKN million in 677J$76 to JNK million in 677P$J7. &his presents the largest potential market in the world. &he annual si=e of the rural F !" market was estimated at around +/I J7.N billion in 677J$76. With growing incomes at both the rural and the urban level, the market potential is expected to expand further. I&#ia / A Lar e C(&su%er G((#s S!e&#er An average #ndian spends around M7 per cent of his income on grocery and 9 per cent on personal care products. &he large share of fast moving consumer goods @F !"B in total individual spending along with the large population base is another factor that makes #ndia one of the largest F !" markets.

CONS4MPTION PIE CHART ,/

,ven on an international scale, total consumer expenditure on food in #ndia at +/I J67 billion is amongst the largest in the emerging markets, next only to !hina.

Cha& e i& the I&#ia& c(&su%er !r()i"e

)apid urbanisation, increased literacy and rising per capita income, have all caused rapid growth and change in demand patterns, leading to an explosion of new opportunities. Around MN per cent of the population in #ndia is below 67 years of age and the young population is set to rise further. Aspiration levels in this age group have been fuelled by greater media exposure, unleashing a latent demand with more money and a new mindset.

De%a&#/su!!"* a! !urrently, only a small percentage of the raw materials in #ndia are processed into value added products even as the demand for processed and convenience food is on the rise. &his demand supply gap indicates an untapped opportunity in areas such as packaged form, convenience food and drinks, milk products etc. #n the personal care segment, the low penetration rate in both the rural and urban areas indicates a market potential.

INDIA COMPETITI;ENESS AND COMPARISON WITH THE WORLD MARKETS Materia"s A'ai"abi"it* #ndia has a diverse agro$climatic condition due to which there exists a wide$ranging and large raw material base suitable for food processing industries. #ndia is the largest producer of livestock, milk, sugarcane, coconut, spices and cashew and is the second largest producer of rice, wheat and fruits ; vegetables. #ndia also has an ample supply of caustic soda and soda ash, the raw materials in the production of soaps and detergents Q #ndia produced J.L million tonnes of caustic soda in 677K$7M. &ata !hemicals, one of the largest producers of synthetic soda ash in the world is located in #ndia. &he availability of these raw materials gives #ndia the locational advantage.

Apart from the advantage in terms of ample raw material availability, existence of low$cost labour force also works in favour of #ndia. 'abour cost in #ndia is amongst the lowest in Asian countries. ,asy raw material availability and low labour costs have resulted in a lower cost of production. any multi$nationals have set up large low cost production bases in #ndia to outsource for domestic as well as export markets.

Le'era i& the c(st a#'a&ta e "lobal major, +nilever, sources a major portion of its product reCuirements from its #ndian subsidiary, 0''. #n 677K$7M, +nilever outsourced around +/I 6J9 million of home and personal care along with food products to leverage on the cost arbitrage opportunities with the West. &o take another case, -rocter ; "amble @-;"B outsourced the manufacture of :icks :aporub to contract manufacturers in 0yderabad, #ndia. &his enables -;" to continue exporting :icks :aporub to Australia, Rapan and other Asian countries, but at more competitive rates, whilst maintaining its high Cuality and cost efficiency.

Prese&ce acr(ss 'a"ue chai& #ndian firms also have a presence across the entire value chain of the F !" industry from supply of raw material to final processed and packaged goods, both in the personal care products and in the food processing sector. For instance, #ndian firm Amul?s product portfolio includes supply of milk as well as the supply of processed dairy products like cheese and butter. &his makes the firms located in #ndia more cost competitive. Tre&#s a&# P"a*ers &he #ndian F !" sector is the fourth largest sector in the economy and creates employment for three million people in downstream activities. Within the F !" sector, the #ndian food processing industry represented L.K per cent of "*- and accounted for JK percent of the country?s exports in 677K$7M. A distinct feature of the F !" industry is the presence of most global players through their subsidiaries @0'', -;", (estleB, which ensures new product launches in the #ndian market from the parent?s portfolio.

T(! Te& P"a*ers i& FMCG Sect(r,/ C(%!a&ies 1. Hindustan Unilever Ltd. 2. ITC (Indian Tobacco Company) 3. Nestl India 4. GCMM (!MUL) 5. "abur India 6. !sian #aints (India) 7. Cadbury India 8. $ritannia Industries 9. Marico Industries 10.Procter & Gamble ygiene and ealth !are

Critica" O!erati&

Ru"es I& I&#ia& FMCG

Sect(r,/

 0eavy launch costs on new products on launch advertisements, free samples and product promotions. ajority of the product classes reCuire very low investment in fixed assets ,xistence of contract manufacturing arketing assumes a significant place in the brand building process ,xtensive distribution networks and logistics are key to achieving a high level of penetration in both the urban and rural markets Factors like low entry barriers in terms of low capital investment, fiscal incentives from government and low brand awareness in rural areas have led to the mushrooming of the unorganised sector -roviding good price points is the key to success

Pe&etrati(& A&# Per Ca!ita C(&su%!ti(&,/

-enetration level in most product categories like jams, toothpaste, skin care, hair wash etc in #ndia is low. &he contrast is particularly striking between the rural and urban segments $ the average consumption by rural households is much lower than their urban counterparts. 'ow penetration indicates the existence of unsaturated markets, which are likely to expand as the income levels rise. &his provides an excellent opportunity for the industry players in the form of a vastly untapped market. oreover, per capita consumption in most of the F !" categories @including the high penetration categoriesB in #ndia is low as compared to both the developed markets and other emerging economies. A rise in per capita consumption, with improvement in incomes and affordability and change in tastes and preferences, is further expected to boost F !" demand. "rowth is also likely to come from consumer 4upgrading4, especially in the matured product categories.

*etergent per capita !onsumption @in 3gB

&ea per capita !onsumption @in 3gB

&ooth paste per capita !onsumption @in 3gB

-ersonal wash per capita !onsumption @in 3gB

&ea per capita !onsumption @in 3gB

/kin care products per capita !onsumption @in )sB

#ce !ream per capita !onsumption @in 'it.B

/hampoo per capita !onsumption @in 3gB

MARKET OPPORT4NITIES FOR IN;ESTMENT,/ According to estimates based on !hina?s current per capita consumption, the #ndian F !" market is set to treble from +/I JJ.L billion in 677K to +/I KK.M billion in 67JN. &he dominance of #ndian markets by unbranded products, change in eating habits and the increased affordability of the growing #ndian population presents an opportunity to makers of branded products, who can convert consumers to branded products. A recent survey of industries in the Fast oving !onsumer "oods @F !"B sector conducted by the Federation of #ndian !hambers of !ommerce and #ndustry @F#!!#B has shown positive growth trends and signs of recovery in various segments .&he survey notes, some sectors showing negative growth in terms of value have recorded positive growth in volumes. The sur'e* attributes the re)"ecte# bu(*a&c* t( the )(""(+i& )act(rs, JB /everal cost saving measures 6B :arious tax benefits KB )ising demand MB "rowing "*NB "ood monsoon LB /trong economic fundamentals 8B &he expected policy packages to be announced by the new government for farmers for raising rural income is bound to stimulate growth further

GROWTH PROSPECTS With the presence of J6.6O of the world population in the villages of #ndia, the #ndian rural F !" market is something no one can overlook. #ncreased focus on farm sector will boost rural incomes, hence providing better growth prospects to the F !" companies. 1etter infrastructure facilities will improve their supply chain. F !" sector is also likely to benefit from growing demand in the market. 1ecause of the low per capita consumption for almost all the products in the country, F !" companies have immense possibilities for growth. And if the companies are able to change the mindset of the consumers, i.e. if they are able to take the consumers to branded products and offer new generation products, they would be able to generate higher growth in the near future. #t is expected that the rural income will rise in 6778, boosting purchasing power in the countryside. 0owever, the demand in urban areas would be the key growth driver over the long term. Also, increase in the urban population, along with increase in income levels and the availability of new categories, would help the urban areas maintain their position in terms of consumption. At present, urban #ndia accounts for LLO of total F !" consumption, with rural #ndia accounting for the remaining KMO. 0owever, rural #ndia accounts for more than M7O consumption in major F !" categories such as personal care, fabric care, and hot beverages. #n urban areas, home and personal care category, including skin care, household care and feminine hygiene, will keep growing at relatively attractive rates. Within the foods segment, it is estimated that processed foods, bakery, and dairy are long$term growth categories in both rural and urban areas. &he survey confirms higher growth rates for some F !"s belonging to personal care products, fabric ; personal wash products, oral care products and 0air care products. &he sectors which have recorded double digit growth in terms of value are shaving cream @67 per centB, deodorant @M7 per centB, branded coconut oil @J7 per centB,anti dandruff shampoos @JN OB, hair dyes @6N per centB, cleaners ; repellents @67 per centB. /ome sectors which have recorded negative growth are personal health care @$K OB 'aundry soaps @$N percentB, dish wash @$K OB, toilet soap @$M.NOB &ooth paste @$N percentB,toothpowder@$9percentB.

A(A'2/#/ %F F !" A)3,&

The research re!(rt ())ers i&si hts i&t( the #*&a%ics () r(+th i& a c(%!etiti'e %ar-et e&'ir(&%e&t< The sa"ie&t )eatures () #e'e"(!%e&t the sur'e* has i#e&ti)ie# i&c"u#e,

&he improvement has been much more pronounced in volume terms than in value terms for most of the products. -ost liberali=ation period provided the consumers the opportunity to make choices amongst the products of domestic companies and imported products. %ne of the greatest achievements made by the F !" industry has been the GsachetH bugs which have helped the companies to introduce products in smaller package si=es, at lower price points and reach new users and to expand market share for value added products in urban #ndia. /everal cost saving measures, various tax benefits, rising demand, good monsoon have helped the industry to achieve positive growth. ost of the multinational companies have started sourcing their products from #ndia. 0'' has become the production center in respect of personal consumer products like oral care, skin care products, soap, detergents globally for +nilever. &here has been a trend from shift to own manufacturing from third party manufacturing or procuring goods from third party small$scale manufacturers. &hough the companies are going global, they are focusing on the overseas markets like 1angladesh, -akistan, (epal, iddle ,ast and !i/ countries because of the lifestyles, consumption habits similar to #ndia. "odrej !onsumer, arico, *abur, :icco laboratories are among the companies. &he offshoots and mushrooming of regional companies which are posing a threat to bigger F !" companies like 0''. &he rise of Ryothi 'aboratories, throwing challenge to )eckitt 1enckiser is a case in point. F !" market remains highly fragmented with almost half of the market representing unbranded, unpackaged home made products. &his presents a tremendous opportunity for makers of branded products who can convert consumers to branded products. &here is competition between the organi=ed and the unorgani=ed sectors in the F !" sector. arketing and distribution are very important in F !" companies. (ew products reCuire a large investment in product development, market research, and awareness campaign, developing franchise for a new brand advertisements, free samples and product promotions. All these developments have made the consumers strong, who are in a position now to choose a variety of products, from a number of companies, at different price points. 1argaining power of customers is high. 3ey factors to success are distribution @in rural marketsB and advertising @in urban marketsB. !ritical factors for success are the ability to build, develop and maintain a robust distribution network. &he fact that a lot of women have started looking for speciali=ed products has driven growth.

/," ,(& WW#/, A(A'2/#/

Fabric +ash %ar-et, &he demand for detergents has been growing at an annual growth rate of J7$JJ per cent during the past five years, while the laundry bar market has witnessed a negative growth. &his year growth rate is low at 6 per cent for detergent cakes and 6.N per cent for washing powder. #n the urban markets, people prefer to use washing powder and detergents, instead of bars, on account of convenience of usage, increased purchasing power, aggressive advertising and increased penetration of washing machines. Pers(&a" +ash %ar-et< While the growth rate for the overall personal wash market is only J per cent compared to average growth rate of N per cent, premium and middle$end soaps are growing at a rate of J7 per cent. &he leading players in this market are 0'' @'ux, 'ifebuoy, 1ree=e, )exonaB, (irma @(imaB, "odrej /oaps @!inthol, Fair"low, /hikakai, (ikharB, and )eckitt ; !olman @*ettolB.

Ora" care %ar-et, &he oral care market valued at )s. 6L bn has suffered a negative growth of N per cent in 677K$ 7M. &oothpaste and toothpowder have suffered negative growth of N O and 9 O respectively. &he market for tooth brushes valued at )s M bn has grown at N per cent.

S-i& care a&# c(s%etics %ar-et< /kin care and cosmetics valued at )s J6 bn and includes cold creams, lotions, moisturi=ers, cleansers, talcum powders, deodorants, lipsticks, nail enamels, etc. &he shaving cream market valued at )s J.J bn, has grown by 67O. &he market is dominated by !$-, "illette #ndia and "odrej /oaps. &he skin care market has seen the entry of a number of international brands, like %riflame, Avon and Aviance. &he herbal$based products are also Cuite popular in this market.

Hair care %ar-et, 0air care includes a variety of branded and unbranded products like hair oils, shampoos, creams, conditioners hair dyes, etc. &he !oconut %il arket account for 86 per cent of the hair oil market. #n the branded coconut hair oil market, arico @with -arachuteB and *abur are the leading players. 0'' is also extending its /unsilk brand to hair oils. &he market for branded coconut oil valued at approximately )s. 9 bn has grown by J7 O. &he market has been witnessing a shift in usage patterns in both urban and rural markets.

Fe%i&i&e h* ie&e %ar-et< &he feminine hygiene market is estimated to be worth )s. 6 bn market. &he market has reversed from a negative growth in previous years and flat growth in the last year has recorded a growth of 6 per cent. &his has got a boost from the withdrawal of excise duties.

De(#(ra&ts %ar-et,

&he deodorant market is estimated to be worth )s 7.9 bn and has been growing at M7 per cent annually. &he organi=ed segment is dominated by 0'' with its )exona, Axe, *enim and #mpulse brands in different categories targeting different segments of the market.

Dish +ash %ar-et, &he total si=e of the dish wash market, estimated at )s M.M bn has recorded a negative growth of K per cent . %ver L7 per cent of the market is dominated by bars, while dish wash powders accounts for K6 per cent. &he penetration levels are, however, still very low.

C"ea&ers = Re!e""e&ts Mar-et, &he cleaner market covering products like floor cleaners, air, phenyl and toilet cleaners, and is estimated to be growing at 67 per cent per annum. &he key players are 0'', )eckitt ; !olman #ndia @)!#B, 0enkel /pic, 1ayer #ndia and 1alsara 0ygiene. &he market for insecticides and repellents is estimated to be around )s 9 bn has grown by 67 per cent. "odrej /ara 'ee is the world?s largest manufacturer of mosCuito mats, with an all$#ndia market share of about LL per cent. &he organi=ed sector is trying to increase penetration levels by higher brand visibility.

),!% ,(*A&#%(/ F%) F !" A)3,&

This research re!(rt (ut"i&es s(%e %easures )(r raisi& !r(#ucti'it*> e))icie&c* a&# %a-i& FMCG c(%!etiti'e as )(""(+s, /
'evel of abatement for soaps and detergents should be revised to MN per cent in consideration of hike in the prices of various inputs. ,xcise duty of about N7 per cent without !,( :A& credit facilities on alcohol based toiletries is very high and should be on par with non$

alcoholic toiletries. 0igher and different sales tax rates in different states. :A& applicable for these products should fall in the proposed M per cent slab. !ompanies need to have a distribution system of its own or rely on other companies and for product awareness and demand creation try new products with already established popular product lines. &he companies should introducing product variants that account for distinctive regional tastes as well as a wide range of package si=es and prices to suit to purchasing preferences of #ndiaHs varied consumer segments.

&he survey confirms that the F !" sector is poised for further growth because of the emerging opportunities and strong fundamentals developing in the economy. &his report highlights the need for pro$active government action for helping the industry to achieve lower cost, improved Cuality and better performance in the competitive environment. &he survey foresees that future growth will come from newer segments such as the youth and through increased rural and small town penetration. &he #nternet and e$commerce will change the dynamics of this industry helping companies improve their procurement, distribution and selling efficiencies. &his will, in turn, help them reduce prices and still remain profitable. A package of fiscal incentives provided by various /tate governments like 0imachal -radesh, +ttranchal, have encouraged companies to set up manufacturing facilities in

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? 6rita&&ia I&#ustries ? C(" ate I&#ustries ? Dabur I&#ustries ? G(#re@ C(&su%er Pr(#ucts ? Hi&#usta& Le'er ? Maric( I&#ustries F !" market remains highly fragmented with almost half of the market representing unbranded, unpackaged home made products. &his presents a tremendous opportunity for makers of branded products who can convert consumers to branded products. #n the past decade, the personal care industry has witnessed a consumer boom. &his has been possible due to liberali=ation, growing urbani=ation and an increase in the disposable incomes due to rise in "ross *omestic -roduct. &he changing lifestyles, higher level of awareness among the rural community as a result of the onslaught of satellite television has fuelled demand. &he boom has also been fuelled by the reduction of excise duties, de reservation from the small$scale sector and the concerted efforts of personal care companies to tap the potentials of the segment of the middle class through product and packaging innovations.