The FMCG sector has been in focus in 2015. Ruling the roost is Godrej Consumer Products Ltd (GCPL). Bloomberg TV India discusses the year gone by and the road ahead with Vivek Gambhir, MD, GCPL.

Over the last five years the stock has given back 300 per cent to shareholders. As we step into 2016, what can GCPL shareholders look forward to?

What has been great is that we have stayed extremely focused in terms of a strategy — of becoming a leading FMCG company in the emerging markets. I think what we will continue to do is to ensure that we drive our topline growth along with delivering profit growth ahead of our revenue growth. So clearly we are really looking forward to an economic environment improvement which will allow us to further build on the track record sustained over the last few years.

I want to focus on how the year 2015 has been. Where have you seen growth really coming in? How do you see the balance going into 2016? Has the urban demand and the tier-II demand been strong enough to offset the weakness in rural India?

Let me try and answer this question in two different lenses. If you look at GCPL’s performance, our volume growth pickup has been good. We have been leading the volume growth in the entire industry on the back of great innovations coupled with very good executions on the market infrastructure side. So the GCPL story has clearly shown resilience. We outperformed all our categories and have gained market share.

At the overall industry level, though, the picture has been a little bit more sobering. We have seen lacklustre growth and, as you pointed out, there has been some pickup in urban. But unfortunately that has been offset by some of the continued stresses that we are seeing on the rural side. So net-net it has been more of the same — just been a gradual pick-up. We do expect this picture to remain for Q4 of this fiscal year but we are hopeful of seeing a pickup in demand starting from the first quarter of the next fiscal. As the government puts in various measures to increase incomes, we should hopefully see better economic growth leading to better FMCG demand starting from Q1 of next year.

I have been looking at some of the aggressive launches and re-launches Godrej has done. It has been quite successful in that strategy in 2015 as well. The GoodKnight Fast Card and Henna Creme are some products that have gained traction for you over the last two-three quarters. Can we expect more launches or even re-launches in 2016?

Absolutely. I think we are targeting about six to eight major launches next year. My guess is that we will probably end up doing about two more launches in Q4 and then the remainder would happen over the course of the year.

But clearly innovations and new product launches is a critical part of our growth strategy. It has worked very well for us and we will continue focusing on this.

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