While ITC was a stole the show with a revenue growth of 32 per cent y-o-y, HLL managed just a tad short of 14 per cent y-o-y for continuing businesses, while Colgate too turned in a top line growth of 15 per cent y-o-y. Britannia and Marico did better at 24 per cent and 26 per cent respectively, while Nestle too impressed at 16 per cent. With disposable income rising and its feel good influence spreading the glow, urban India is buying, and buying in droves.

Rural demand too is putting up quite a good show. Confirms Sunil Duggal, CEO, Dabur India, "Rural demand is much stronger this year and many of our SKUs (stock-keeping units), which cater to the rural population such as shampoo sachets, are doing much better. Thus, rural demand is now catching up with urban demand." The rural market for FMCGs is estimated to be growing at around 11-12 per cent while a combination of both (i.e. urban and rural) registers a neat 8 %.

In fact the AC Nielsen August survey shows that all the top-12 categories have grown over at least 10 % while two-thirds of the companies have seen a growth of over 20 per cent y-o-y.

Organized Retail

The huge number of large format retail stores in the metros, has also spurred sales. Though sales through modern trade form a very small percentage of overall sales, these larger stores-on the low base- are growing at around 20 per cent, far eclipsing the growth rates of the smaller traditional grocery outlets.

While it must be admitted that margins on sales to organized retail are slightly lower, it is observed that modern retail encourages growth, because there is greater interaction between a consumer and a product in the modern stores.

Modern trade allows more visibility to good brands and promotes trials of new categories, and thus customers who are satisfied with a new product tend to make repeat purchases.

Clearly, the opportunity to make products more visible by creating special units or doing special promotions is translating to increased turnovers. It could be turn out to be an important factor in driving growth FMCG space because it's a good way to capture the wallet share of the consumer.

Industry experts say that sales through these retail outlets are growing three times as fast as through the regular channels and exponential growth is expected through modern trade from now on.