FMCG firms resist further price cuts amid competition and declining raw material costs

Fast Moving Consumer Goods (FMCG) companies are holding firm on their product pricing, despite falling raw material costs and increased market competition. This decision is aimed at safeguarding their profit margins, according to a report by BNP Paribas (OTC:) published on Friday.

Godrej Consumer Products and Hindustan Unilever (LON:) have recently adjusted their pricing strategies for mass brands. Notably, Lux, a brand under Hindustan Unilever, has slashed its prices by 18%. This move comes as premium soaps and oral care sectors are experiencing price hikes.

In the edible oils segment, Sundrop and Fortune have led the way in price reductions. However, these cuts appear to be the exception rather than the norm in the current market conditions.

Meanwhile, Colgate and Dabur have marked price increases in the oral care sector. This trend is notable as it goes against the broader market conditions, which have seen a general decline in raw material costs.

BNP Paribas suggests that these pricing strategies are likely to persist in the near future. As FMCG firms grapple with competitive pressures and fluctuating raw material costs, maintaining their margins remains a top priority.

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