FMCG companies face quality issues and regulatory actions, risking consumer trust. Nestle India, Patnajali, Bournvita controversy, and Hindustan Unilever rebrand amidst inflation challenges and omni-channel adoption. While stock meltdown and regulatory action are short-term risks, losing consumer trust is a long-term and bigger risk for an FMCG company.
Ritesh Tiwari, the Chief Financial Officer of Hindustan Unilever, announced the change during the earnings press conference on April 24. Tiwari emphasized that the shift to the FND label provides a more accurate and transparent description of the category. He highlighted the under-penetration of the FND market, indicating significant growth opportunities.
Cadbury Bournvita recently faced a setback in the malted drink category when the Government of India instructed e-commerce sites and portals not to label it and a few other brands as health drinks due to the absence of such a category in the country s food laws. This decision followed an influencer s post highlighting Bournvita s sugar content, leading the brand to reduce it by nearly 15%. The evolution of milk additives, including chocolate MFDs like Ovaltine, Bournvita, and others, has been driven by the need to make milk more appealing to children.