ITC reports weakest FMCG consumer spend in a decade

Kolkata: Consumer spending on ITC Ltd's fast-moving consumer goods (FMCG) grew at its slowest pace in over a decade in the last fiscal year, according to the company's annual report released on Friday.

Sales of ITC's daily necessity products such as packaged food, personal care, stationary, agarbatti and safety matches grew just 4.6% year on year in 2024-25 - to ₹34,000 crore - compared with annual growth range of 9-21% in the last 10 years. While the company's FY25 annual report did not specify any reason behind this slower growth, industry executives said it could be a reflection of a slowdown in the overall FMCG industry amid a quick commerce discounting war in large cities, which may have slowed down consumer spending on daily products.

Even during the Covid-hit 2020-21 when supplies were severely impacted, consumer spending on ITC's FMCG goods had grown 11.7% year on year. It grew 12% in FY24.

Consumer spending refers to the amount a consumer spends on a product at retail outlets, which includes the company's realisation, trade margins and taxes.

ITC's packaged food business clocked ₹18,270 crore of gross sales in 2024-25, up 6% on year. However, gross sales of other FMCG products including stationery, personal care, safety matches and agarbattis declined by 0.9% on year at ₹3,705 crore, as per its annual report.

The company does not disclose business-wise sales in its quarterly financial report.

Even as urban slowdown persisted, rural demand for India's FMCG market declined in the January-March quarter year-on-year, though it was still four times faster than in cities, according to market researcher NielsenIQ.

Volume growth, or number of units sold, slowed down in the March quarter to 5.1% compared to 6.1% in the year-ago quarter.