FMCG sector is witnessing a shift in consumption pattern: Shree Rama Managers 

FMCG stocks have remained in focus in the last three months after the government reduced GST rates on items of daily and essential needs. GST on many items, including packaged milk, packaged curd, soaps, shampoos, and certain biscuits, now stands at 5% or 0% GST rate.

However, according to reports, the fast-moving consumer goods (FMCG) sector still awaits full impact of the tax cuts, as consumers preferred to spend on big-ticket items such as cars and consumer durables rather than everyday staple. 

Consumers have preferred big-ticket items such as cars, two-wheelers where savings were more visible instead of buying daily needs items, where savings were low. 
 
Abhishek Basumallick, Co-founder & Fund Manager, Shree Rama Managers in a conversation with Business Today said consumption of people have moved significantly away from the large listed FMCG players to non-listed players.

"Right, so today what has happened because of can be easily achieved through e-commerce and quick commerce. The real moat that these FMCG companies had was distribution. Now, that has become much more easier for smaller, nimbler regional players to come in and take market share," said Basumallick. 

"So, it is not that the consumption of FMCG has reduced. It is just that the, you know, it has become much more broad based into companies that are not listed in the market," added Basumallick. 

Meanwhile, the BSE FMCG index slipped just 8 pts to close at 20,127 points in the current session. On the other hand, Sensex fell 533 points to 84,679. On similar lines, Nifty ended 167 points lower at 25,860.