MUMBAI, May 22: Hindustan Lever (HLL) has undertaken price increases almost across-the-board in soaps and personal products in the last few weeks, say retailers. The price increases are on an average of 8-9 per cent. Popular products have not been left untouched by the increases.Detergents, however, have not witnessed such price mark-ups in the recent past.
Price hikes are generally undertaken by the fast-moving consumer goods (FMCG) majors like HLL about three to four times during the year. These are undertaken on account of certain raw-material prices which may have shot up, or on inflationary grounds, said analysts.
For instance, Hindustan Lever has increased the maximum-retail price (MRP) of its leading shampoo brand Sunsilk from Rs 100 on a 300 ml bottle to Rs 105 in the last 15 days. The price of Sunsilk was Rs 86 three months ago, said retailers.
It has thus appreciated by almost 22 per cent. The price of Close-Up, a premium toothpaste brand, has gradually increased by Rs 5 to Rs 34, a 17.24per cent rise. The price of Pepsodent has also increased to Rs 38 from Rs 34. Similarly, the maximum-retail prices of Lux toilet soap and Vim bar have been revised upwards to Rs 9.05 and Rs 7.38 by almost 10 per cent. Prices of popular products like Jai and Breeze soaps have been hiked to Rs 6.02 (Rs 5.57) and Rs 6.10 (Rs 5.20).
HLL, being the leader in almost all the FMCG categories, is likely to be followed by other FMCG companies in such price mark-ups. The price increases have come just before the union budget. Retailers feel the post-budget price scenario cannot be predicted as this would depend on the excise-duty levels on soaps, detergents and dentifrices.
The industry has represented to the government for reducing excise duties on toilet soaps and detergents from 18 per cent to a lower slab of 8 per cent. The industry also expects the government to reduce excise levels on cosmetics & toiletries from the current level of 30 per cent.
While analysts feel reduction in excise levels is unlikely,going by the fiscal condition, any cut in excise duty is immediately passed on to the consumer. This results in reduced prices, which spurs demand and thus the growth in these sectors.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.