The good news from this Budget is that there has been on tinkering of excise duties and other charges which can impact the final price of items of daily consumption. So, prices of fast moving consumer goods are unlikely to go up now. “FMCGs’ prices are related to raw material prices. Hence, we do not see any price rise in items of daily consumption immediately. On the contrary we see consumption of daily goods going up after the budget,” says Ullas Kamath, Joint Managing Director, Jyothy Labs.
Kamath says after demonetisation the government has been trying its best to make more money available to people. Measures such as reducing income tax, increased spending on agriculture, infrastructure and rural development will lead to more job creation. “This in turn will trigger spend on FMCG and boost overall consumer spending and the consumption cycle,” he says.
CK Ranganathan, Chairman & MD of CavinKare, says GST enactment will boost offtake of FMCGs. He believes too that the demonetisation impact on consumer goods was marginal and companies such as his saw growth of 15 per cent over the past few months.
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