By Diwali, We Will See Some Good Rural Recovery: Sudhir Sitapati, GCPL

Sudhir Sitapati, Managing Director and CEO of Godrej Consumer Products (GCPL) has expressed optimism about a recovery in rural markets in the latter half of the year, buoyed by a promising monsoon season and proactive government measures.

"A lot of people are saying it and I'm also seeing a little bit of green shoots. Also, the government is quite cognizant of reviving consumption in rural areas. I'm actually quite optimistic, the monsoon also seems quite good. So I'm quite optimistic about rural revival. For the last two to three years, I have not been sure, but I think by Diwali we will see some good rural recovery," Sitapati remarked.

Sitapati highlighted the critical role of rural consumption in driving the fast-moving consumer goods (FMCG) sector, noting that it should ideally grow at one-and-a-half times the rate of urban consumption. 

"That is what has been the case for the last 20 to 25 years. It's not like rural is actually under-growing urban, it's just not growing faster than urban like it was," he explained.

Addressing the broader economic landscape, Sitapati underscored the need to stimulate domestic consumption. "GDP growth rate was 8 per cent last year but domestic consumption was only 4 per cent. Domestic consumption is often a measure of income growth at the bottom of the pyramid. So 4 per cent domestic growth has to go up. Consumption growth and GDP growth have to be in tandem. I'm sure that the government will take measures to spur domestic consumption," he said.

Sitapati shared the insights during the unveiling of a new Renofluthrin formulation in GCPL's GoodKnight Flash liquid vaporizer.

He also addressed the widening economic divide in India, emphasising diverse spending patterns across different segments of the population. “At the top of the pyramid, the top 20 per cent of India, who hold 50 per cent of the GDP, are experiencing a boom in discretionary spending. The next 80 per cent are under stress, which even government data suggests. Consumption growth is 4 per cent while GDP growth is 8 per cent, indicating this disparity.”

In response to the economic trends, Sitapati mentioned that GCPL is continuously innovating to cater to the evolving market dynamics. The company is focusing on the top of the pyramid for ecommerce and modern trade, while also making products more accessible to the bottom of the funnel.