We all rely on these FMCG Products from the beginning of the day to the finish. Fast-moving consumer goods (FMCG) companies, also known as consumer packaged products (CPG) are mainly responsible for Producing, transporting, and advertising of FMCG products. Domestic and personal care items account for half of all FMCG sales, making it India’s fourth-largest economic sector.
By 2025, India’s packaged food market is predicted to double to $70 billion. Food processing and single-brand retail have both received 100% FDI approval, while multi-brand retail has received 51%. According to Nielsen, the Indian FMCG industry grew 9.4% in the January-March quarter of 2021, owing to consumption-driven growth and greater value from higher sales volumes, particularly for basics.
This fundamentally strong sector has very bright future as demand for consumer goods will always remain in market and it will keep growing in coming years. This sector gives us a solid opportunity to invest in FMCG companies which will give good return in future. Here we are giving you list of seven best Indian company which have bright future.
ITC is India’s largest FMCG Company and a market leader in the Indian Paperboard and Packaging business. ITC is worldwide prominent pioneer in farmer empowerment through its significant agri business, and India’s largest hotel network. ITC Infotech is a global digital solutions specialist that is a wholly-owned subsidiary of ITC. ITC has diversified itself in numerous businesses which cover a large market. ITC is also one of the biggest players in tobacco business.
ITC has market cap of Rs 252,393 Cr and currently trading at PE of 19.2. If we talk about return then ITC has given 23.8% in last three years as compared to Nifty return which stands at 43.80%. Company sale and other numbers are growing well and ITC is one of the best investments for long term. ITC has been facing some issues due to its tobacco business but now company is working to sort it out which will help stock to grow further.
Hindustan Unilever Limited
HUL was founded in 1931 as Hindustan Vanaspati Manufacturing Co., and after a merger of constituent businesses in 1956, it was renamed Hindustan Lever Limited. The company was renamed Hindustan Unilever Limited in June 2007.
Home care, beauty and personal care, and Food & Refreshments are the three key categories in which Company operates. Company divides its brands into three groups based on the amount of money they generate. Surf Excel, Brooke Bond, and lifebuoy are among the 2000 crore+ brands. Pond’s, Dove, Lux, and Pears are among the brands worth 1000 crores or more, while Pears, Kissan, and Vaseline are among the brands worth 500 crores or more. It has a strong presence in India’s markets and is well-positioned in rural areas to make profit from rising income levels.
HUL has market cap of Rs 575,332 Cr and currently trading at PE of 70. HUL is almost debt free company which makes it more attractive. It also has good track record of ROE, company 3 year ROE stands at 48.80% while company has maintained a healthy dividend payout of 92.50%.
The Nestle Anglo-Swiss Condensed Milk Company (Export) Limited began operations in India in 1912. Importing and selling finished milk products in the Indian market was the business at the time.
Nestle India currently operates famous brands like Nescafe, Maggi, Milkybar, Kit Kat, Bar One, Milkmaid and Nestea. The company has also recently introduced products of daily consumption such as Nestle Milk, Nestle SLIM Milk, Nestle Dahi and Nestle Jeera Raita.
Nestle India has a market cap of 168,792 Cr and currently trading at PE of 78.2. Company is almost debt free and it has delivered good profit growth of 18.65% CAGR over last 5 years. Nestle has good track record of Return on Equity which stands at 68% in 3 years frame and company has also maintained healthy dividend payout of 109.70%.
With an initial investment of INR 295, Britannia Industries was founded in 1892 by a group of British industrialists. It is one of India’s oldest companies, and it is currently part of the Nusli Wadia-led Wadia Group. Britannia is one of India’s most reputable food companies, with well-known brands such as Good Day, Tiger, NutriChoice, Milk Bikis, and Marie Gold. The company was also recently added to the Nifty-50 index as a benchmark.
Britannia has market cap of Rs 88,000 Cr and sales of over 13000 Cr as of FY21 data. Company is currently trading at PE of 47.4 which makes it more efficient as compared to other companies. Company’s Return on Equity stands at 36.50% on 3 year basis while it has maintained a healthy dividend payout of 98.2%.
Marico Ltd was founded in 1990 and is now one of India’s major consumer products firms in the beauty and wellness industry. Hair care, skin care, edible oils, health foods, male grooming, and fabric care are among the company’s many brand categories. Marico has developed over 25 brands in the areas of hair care, skincare, edible oils, health foods, male grooming, fabric care, and hygiene. It is present in over 25 countries across emerging markets of Asia and Africa.
Marico market cap is 66,000 Cr and currently trading at PE of 56.9; if we talk about other aspects of company then it almost debt free company and has been growing constantly. Company has good Return on Equity numbers which stands at 36.95% over three year’s timeframe while company maintained a dividend payout of 74.28%.
Godrej Consumers Product
Godrej Consumer Products is engaged in a fast moving consumer goods Company, manufacturing and marketing Household and Personal Care products. GCPL’s products include soap, hair colourants, toiletries and liquid detergents. The company has a history of 120+ years and today has a presence in 90+ countries and touches the life of 1.15 billion citizens. GCPL has seven manufacturing plants in India, divided into four working clusters.
Godrej Consumers market cap is Rs 89,000 Cr and currently it’s trading at PE of 50.7, company is constantly reducing its debt and now almost a debt free company. Company’s sales growth is poor in last 5 years while it has given 24% Return on Equity in 3 and 5 years timeframe. Company’s operating margin is healthy and share has performed well at CAGR of 20% over 10 years and 11% in five years.
Tata Consumer Products
Tata Consumer Products, a subsidiary of the Tata Group, is a fast-moving consumer products corporation located in Mumbai, Maharashtra, India. TATA Consumer Products was formed when Tata Chemicals de-merged its Consumer Products Business as a going concern into Tata Global Beverages in an-all equity transaction in February 2020. The company currently manufactures Tea, Coffee, Liquid beverages, Salt, Spices and Staples and operates a joint venture with Starbucks in India. It is the world’s second-largest tea producer and distributor, as well as a major coffee grower.
Tata Consumer’s total market cap is around Rs 69,800 Cr and its currently trading at PE of 80. Company is almost debt free and it has delivered good profit growth of 151.35% CAGR over last 5 years. Company’s Return on Equity is quite low at 6% for last three years, while it is maintaining a healthy dividend payout of 45.40%.