Lockdown Extended: FMCG Companies prepare to meet demand - Navin Tewari - CEO of Capital Foods

"In case of pure play food companies, though the prevailing uncertainties and sudden lockdown subdue the demand supply equation over the last month and a half we are expecting a V Shaped recovery in demand Q3 of this calendar. Some pockets are already showing an uptick in demand. Typically, aata, daal & chawal are looked upon as basic food items but noodles, pasta, snacks, schezwan chutney have become equally mainstream. We have already seen a 50% increase in demand for such products in certain cities. In the Eastern part of India, we see good demand from West Bengal, Jharkhand and Bihar, in north India, Delhi, Haryana, Uttrakhand and UP are seeing demand revival. Bangalore is another market where we are seeing substantial growth in demand. What is intriguing is the format of stores. In Eastern part it is small stores that are fulfilling the demand while in cities like Bangalore the large format stores are highly active. We are observing a very strong connect of neighbourhood stores who are catering to consumers across the country particularly in North & West India. Going forward this trend may continue in this calendar year.

To ensure there is no shortage of products under our brands Ching's and Smith & Jones, we are operating at a war-footing to serve national duty of serving Indian consumers. Even if the lockdown continues our entire supply chain is well oiled to respond. Our primary units are operational and to safeguard our employees and protect the quality of our products, we have made arrangements within the factory premises for some employees to stay . Sensing the risks associated with the pandemic we have also facilitated Special COVID19 Health Insurance Policy for employees covered under the Group Mediclaim Insurance Policy. We have also created ID cards & authority letters overnight not only for our employees but also distributors and super stockists citing that they are an integral part of the supply chain of essential food items, to facilitate production and distribution. We are back to 75% of production level in some product categories while we are operating with just 45% of manpower."

Source : Equity Bulls

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