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COVID-hit products, categories will rebound in 2021: HUL

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FMCG major Hindustan Unilever expects its “COVID impacted” product categories, such as ice-cream and vending solutions, to rebound strongly in 2021 with increase in mobility. In an investor presentation, the company also said categories such as skin care and colour cosmetics, which slowed down last year will also rebound.

“These categories remain structurally attractive for us,” HUL said in a presentation.

On the other hand, the company said “COVID obsessive” categories such as hand sanitisers and hand wash which saw a sharp surge during the pandemic are also expected to normalise this year. Hand sanitiser category surged 16 times in 2020 compared to 2019, while the hand wash category grew 1.5 times last year.

Categories such as hand, body and face care, classified as “COVID resistant” items are expected to “to normalise with increase in mobility in 2021”, HUL said.

From a peak decline of 73 per cent in the second quarter of the calendar year 2020 during the lockdown these have recovered, with the gradual unlocking that the country went through, to a decline of 51 per cent in the third quarter and 30 per cent in the fourth quarter in line with improving mobility, it added.

Similarly, the company said “COVID impacted” categories, which include ice cream, food solutions business and vending business are also expected “to rebound strongly in 2021 with increase in mobility”.

HUL said its “COVID relevant” categories such as dishwash, tea, toothpaste and shampoo are back to pre-COVID levels and expect to sustain in 2021.

The company said from an economic meltdown due to the pandemic, there has been a sharper than anticipated recovery. Although there is shrinking consumer sentiment, the outlook on the future is optimistic.

Stating that the coronavirus pandemic has shaped new consumer behaviours, such as staying at home, stocking and saving, contactless culture, clean living, and online shopping, the company said some of these trends will continue post the pandemic.

Clean living and online shopping are expected to sustain strongly after COVID even as people realise that it is a better habit to use protective measures, it said, adding fear factor will also linger.

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