Biscuits, briefs, bikes, underwear and booze-5 Key Sector To Judge Slow Down!

Slow Down

Biscuits, briefs, bikes, underwear and booze: These 5 categories have long been among the most accurate 5 gauges of discretionary spending, and by extension, of the consumer's belief in the economy.

This fall in sentiment has been widely attributed to listless growth of incomes. Nominal per capita disposable income in India fell to 9.5 per cent between 2015 and 2018 from a high of 13.3 per cent between 2010 and 2014.

Dwindling disposable income is Primarily why Indians of all hues have cut down on or delayed buying essential items and even staple consumption items, analysts say.

"An inside story from The Economics Times"

Biscuit's is not a chance fall. The slump in the sale of briefs, or innerwear, is raising a similar red flag for the consumption sector.
During the period, India's top four listed innerwear companies posted the worst numbers in 10 years. The June numbers of Page Industries — the maker of Jockey briefs — were its slowest since 2008. VIP contracted by a sharp 20 per cent, Lux was flat, and Dollar Industries shrank 4 per cent.
A spoke in the wheels
The spoke in the wheels of India's bike industry is now too big to ignore anymore. Two-wheeler sales slipped by a good 16.82 per cent in July, the latest in a series of similar monthly performances.
The commercial vehicle segment fell even more steeply, with sales nosediving by a high 25.71 per cent. The passenger car story for July was much, much worse — sales dropped by a humongous 30.98 per cent, numbers never seen in the last 20 years.
These numbers portend seriously bad tidings for a sector that directly or indirectly employs 37 million workers. The sharp fall in demand has already compelled car/bike makers to cut production, affecting 3,50,000 jobs across the country's auto sector in the last three months alone.
Several hundreds of car showrooms have already shut shop — the likely beginning of an Armageddon for an industry that could see a million more jobs vanish if the slowdown does not ease.
What lies ahead
Nomura yesterday issued the latest of a series of dire warnings: Growth is set to slow further in the April-June quarter to 5.7 per cent.
"High-frequency indicators continue to show familiar pain points – a deep contraction in consumption, weak investment, a slowing external sector and an under-performing services sector," the global financial services major said.
The grim prediction came amid fears that slowdown pains may prolong as consumer confidence takes further hits from flat FDI growth and global trade & currency wars.
Growth in India fell to 6.8 per cent in 2018-19 — the slowest since 2014-15 — largely owing to the travails of consumption, the segment that accounts for over 60 per cent of GDP. With more and more signs of trouble emerging, numbers suggest this slowdown could be deep and could keep the 5 Bs sputtering.
So, what is the likely road ahead for these four pillars of India's consumption story? A lot will become clear on August 30 when official GDP numbers for the April-June quarter are out.

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