After a strict lockdown impacting sales, India has returned to the growth path again, Anglo-Dutch FMCG major Unilever has said.
According to a PTI report: The return of growth of India business, along with Brazil and continued recovery in China helped the company’s emerging markets clock a growth of 5.3 percent in the September 2020 quarter.
“India (business) grew low-single digit, driven by growth in foods and refreshment and hygiene. China grew double-digit led by beauty and personal care categories and a return to growth in food service, as the out-of-home eating channel returned to full capacity,” Unilever said in its post-earnings statement.
After a strict lockdown earlier in the year, India saw a pick-up in economic activity, even though cases of COVID-19 continued to increase during the quarter, said Unilever.
India comes under the Asia, AMET (Africa, Middle East, Turkey) and RUB (Russia, Ukraine, Belarus) market region of Unilever, which has reported a turnover of 6 billion euros.
“Underlying sales grew 4.5 percent with 3.7 percent from volume and 0.7 percent from price, as lockdown restrictions eased across much of the region compared to the first half of the year,” it said.
While overall, Unilever has reported a turnover of 12.9 billion euros for the July-September quarter, which was 2.4 percent lower than the corresponding period of 2019 on with “a negative impact from currency of 7.7 percent”.
However, its underlying sales growth was of 4.4 percent, with 3.9 percent volume growth.
According to the company for the emerging markets, underlying sales growth was 5.3 percent and 3.1 percent for the developed market.
“Underlying sales growth accelerated compared to the second quarter (April-June). Elevated levels of growth for hand and home hygiene products continued, as well as for food consumed at home,” said Unilever.
Its food service and out of home ice cream businesses continued to decline, however, at lower levels compared to the second quarter, it added.
Commenting on the results, Alan Jope, CEO, Unilever said, “We have delivered a strong performance this quarter. Volume-led growth shows the resilience of our portfolio and our agility in responding to rapidly changing dynamics across consumer segments, geographies and channels.”
Earlier this Tuesday, its Indian subsidiary Hindustan Unilever Ltd (HUL) had declared the results of the second quarter (July-September) reporting a better-than-expected rise net profit and revenues, signaling a revival of demand.
HUL’s consolidated net profit rose 8.6 percent to Rs 1,974 crore in July-September, while revenue from the sale of products was up 13.7 percent at Rs 11,510 crore, the company had said in a regulatory filing.
The food and refreshment business saw nearly 83 percent jump, while home care and beauty and personal care was almost near pre-COVID-19 levels.
HUL, maker of popular brand products such as Rin, Dove, Lux and Lifebuoy, said the worst is behind and is “cautiously optimistic” on demand recovery.
Unilever follows January-December financial year, while HUL follows April-March fiscal cycle.
The Indian economy had seen an unprecedented 23.9 percent contraction during April-June as the lockdown imposed to curb the spread of coronavirus pummeled demand and investment.
HUL had got a major boost in its Q2 topline with the inclusion of GlaxoSmithKline Consumer Healthcare’s as health drink brands such Horlicks, performed well as immunity-boosting products were much in demand during the pandemic. On a like-for-like basis, excluding M&A, its growth was 3 percent.