Only 44% of rural India willing to pay for COVID-19 vaccine doses

As the country waits anxiously for the official launch of the coronavirus vaccine including those from Indian pharmaceutical companies, a survey of Rural India by Gaon Connection (GC) reveals that 44% of the respondent households were willing to pay for the vaccine. While 36% said they wouldn’t and 20% said they were not sure.

Of those willing to pay for the vaccine in rural India, two-third were open to shelling out less than Rs 500 for two doses and just 8% were comfortable paying Rs 1,000 more. Also, over than 33% respondents said their elderly parents would be the first to get vaccinated.

The findings are a part GC’s third rural survey titled the ‘COVID-19 Vaccine and Rural India’. Conducted across 60 districts in 16 states and one union territory, the face-to-face rapid survey comprised a sample size of 6,040 households and was conducted between December 1 and December 10, 2020.

The survey also asked rural citizens if the government had to prioritise vaccination, who should be given the top priority to which 43.5% respondents said it should be the doctors and nurses.

The GC survey also showed that over 51% respondents believe the COVID-19 disease was a “conspiracy by China”, 22% said it was due to failure of people to take precautions and 18% felt the government failed to contain the spread.

While jobs and incomes were impacted, half of the survey respondents said spend on buying / consuming packaged immunity boosting products viz. Chyawanprash, Giloy, Kaadah, Vitamin tablets, etc. has increased during the pandemic. That’s not all, the coronavirus outbreak altered the food habits of rural citizens. Almost 70% stopped eating outside food, over 33% were consuming more vegetables and 30% were having more fruits in their daily diet.

Around one-fourth of the total respondent households reported that samples from at least one member of their household was taken for the testing of COVID-19. The proportion of such households was the highest (42.6%) in the east-and-northeast zone, whereas it was the lowest in the north zone (10.9%).

Of the 25.9% respondent households who reported their family member(s) getting tested for COVID-19, more than half, that is 59%, said at least one person in their household had tested positive for the coronavirus. Overall, 15% of the total 6,040 respondent households reported at least one person in their household/friend circle testing positive for COVID 19.

Overall, some 15% rural households reported at least one person in their household / friend circle testing positive for COVID 19.

Those keen for more details on the survey can download the full report published under the title ‘The Rural Report 3: COVID-19 Vaccine and Rural India’ from www.ruraldata.in.

(The writer is a Mumbai-based independent business journalist and has extensively covered diversified consumer businesses over the last two decades. He can be reached at hello@ashishktiwari.com)

Titan cuts H2 FY’20 growth guidance to 11-13% from over 20% earlier

A version of this story first appeared in The Free Press Journal on Wednesday, November 6, 2019.

Stressed consumer sentiments coupled with growing tendency for conserving cash in hand is likely to impact growth targets for consumer companies in the remaining quarters of the current fiscal. And as demand environment continues to be sluggish, consumer companies could be looking to revise their growth guidance for the second half (H2) of fiscal 2019-20 (FY’20).

Taking a lead in this direction is Tata Group’s jewellery, watches, eyewear and fashion accessories business vertical, Titan Company Ltd (TCL). The company management said in an earnings call on Tuesday evening that it has revised jewellery business growth guidance for the period between October 2019 to March 2020. Taking a cautious approach Titan Co. management had in August 2019, said that it was targeting over 20% revenue growth keeping the wedding and festive season in mind.

C K Venkataraman, managing director, Titan, said, “The guidance has been revised to between 11% and 13% now from the earlier over 20% growth levels.” The downward revision has been done after taking into account that overall market situation and consumer buying behaviour, said the top company executive.

Analysts tracking Titan are of the view that the premise of over 20% growth talked about earlier was based on company’s execution of business and not necessarily relying on overall macro market conditions. However, the change in the guidance now is an indication of concerns in this industry as a result of which Titan management has made a significant correction in its growth numbers going forward.

Abneesh Roy, executive vice president - institutional equities (research), Edelweiss Securities, said that the brokerage has been pointing that achieving 20% guidance in H2FY20 is very difficult in jewellery business given weak sentiments, high base of 36% in Q3FY20 and 21% in Q4FY20. “For FY21, the company is yet to change guidance from current 20%. By next quarter, Titan said they will have more clarity,” said Roy.

 
While Edelweiss expects Titan to correct 5-6% in near term, from longer term perspective, the brokerage maintains a BUY on dips given huge retail expansion, struggling competitors and increasing formalisation of jewellery sector.

Elucidating the reasons that led to revising the guidance, Venkataraman said, the company had set out a growth table for five years based on positive sentiments in the business environment. Growth may have been sluggish, in single-digits or flat during the fiscals 2018 and 2019 owing to certain migration that started happening as a result of a lot of structural changes, demonetisation, Nirav Modi scam and so on.

”The trust factor started kicking in, in favour of Tanishq and we were able to deliver a 20% plus growth rate with a certain set of initiatives and certain level of excellence in our execution. Our internal research with consumers done earlier in January and February 2019, indicated positive sentiments. However, what’s appearing now after six - seven months, is that the sentiment is actually worse than what we had measured then.

“As a result, the overall industry has witnessed 70% decline in imports, every single jeweller that we are aware of, is talking about a decline, vendors are talking about big drop in supplies. Regional jewellers are talking about a 12% and 22% decline in business during the festive period as opposed to 10% positive growth that has been achieved by Tanishq. So, obviously the strategies and standards of excellence in our execution are happening in a circumstance that’s less in our favour than a year ago,” he said.

Taking into account the market conditions, the company had to go back to the drawing board, expand the number of weapons that required (to deal the market conditions) or create fresh ones. That, as per Venkataraman, will take a little more than a few months and hence the change in guidance for October 2019 to March 2020 period.

“It is our intent to keep gunning for the over 20% growth number for fiscal 2021. For the moment though, it can only be about tweaking of the arsenal that we already have. And we are going by the more recent growth performance over the last three to four months,” he said.

While companies like Hindustan Unilever Ltd (HUL) operating in the fast moving consumer goods (FMCG) sector are optimistic about overall business, the company management had earlier said that near-term demand outlook, especially in the rural markets, remains challenging.

Among India's leading Ayurvedic and natural health care companies, Dabur said that it is working on achieving its annual growth target of mid to high single digits for the full year.

On the possibilities of revising the guidance for the second half of current fiscal, Mohit Malhotra, chief executive officer, Dabur Ltd, said, there was no need to do it. “We will work to achieve the targeted growth rates for the fiscal 2020,” he said in the earnings call on Tuesday.

(The writer is an independent business journalist and can be reached at ashishktiwari.1976@gmail.com)