Organized sector benefited after Corona


Posted on 23rd Jun 2020 12:10 pm by rohit kumar

During the last few years, there has been a tendency for the economy to be gradually organized, but due to the Covid-19, it has suddenly increased. Organized companies in sectors such as jewelry, paints, biscuits, beverages, foodstuffs to restaurants are growing their market share, snatching the market share of financially weak, small, and organized companies. The level of production and balance sheet of the organized sector is better than that of the unorganized sector. The unorganized sector has suffered a lockdown, with many businesses being shut down. At the same time, consumers concerned about safety and hygiene have turned to established brands.

 

CRISIL estimates that organized sector jewelry companies like Tanishq will have a share in the business to more than 45 percent by 2021-22, from 25 to 35 percent in 2017-18. Titan CEO (Jewelry Division) Ajay Chawla said that jewelry companies have been under pressure due to rising gold prices, lower demand, and stricter lending by NBFCs and banks. Chawla said, "After Covid-19 this pressure has increased. In such a situation, only those companies will have more cash, whose balance sheet is strong and they are reliable in the market.

 

Chirag Seth, senior research consultant (South Asia) at Metal Focus, an international bullion research company, said that size has become very important after the Covid-19. "Customers will avoid going to smaller stores, which can only have three to four customers as it will be difficult to maintain physical distance," he said.

 

Even the paint business is changing. The unorganized sector, which has a 30 percent share in this market, is highly scattered, with more than 3,000 paint manufacturers. Kansai Nerolac MD HM Bharucha said, "These entrepreneurs will not be able to do business as easily in the post-Covid-19 world as the cost of sanitation and safety would be greatly increased." Another challenge, he says, is that organized companies are making deep inroads in India. They are targeting medium and small cities and towns where small entrepreneurs operate. Bharucha estimates that in a few years the share of the unorganized sector will come down to around 20 percent.

 

Similarly, the organized sector currently accounts for about 65 percent of the Rs 57,000 crore biscuit business in the country. Mayank Shah, senior category head of Parle Products, predicts that the organized market will grow as the number of consumers buying packaged and branded products is increasing.

 

Shah said, 'This gives them confidence that the products are cleanly made and safe. Household consumption of biscuits has increased during the lockdown. Organized biscuit manufacturers ensured that production and distribution continued despite challenges in lockdown.

 

A similar trend is visible in the Rs 14,000 crore juice market, in which big companies like PepsiCo and Dabur India have their presence. Fifty percent of juice is consumed outside the home market, which is dominated by the unorganized sector. The organized sector dominates domestic consumption. But during the Corona period, 50% of the unorganized market has come to a standstill. The financial impact of the lockdown has forced many smaller restaurants to close their operations. After the restaurant opens, people will prefer to stay away from smaller restaurants for fear of less cleanliness.

 

Consumption habits of consumers have also changed about daily food items like sugar and edible oil, which is beneficial for organized entrepreneurs. It has to be seen whether this trend is good in all industries. Consolidation increases competition, which is good news for consumers. But the shrinking of a large number of unorganized sectors that provide employment may adversely affect employment opportunities.

1 Like 0 Dislike
Previous news Next news
Other news

Relief from corona to pollution in Delhi, a gift to Chandigarh, personal loan broke the record

There is news from various fields in the country every day, which includes big news from crime, p

Disabled: Big decision of the Center - No adjustment of the meritorious disabled selected in the general category in the reserved category

The meritorious Divyang selected in the general category will no longer be accommodated in the re

Kejriwal government's gift before Diwali, big relief on outstanding water bills

There is good news for Delhiites. Ahead of Diwali, Chief Minister Arvind Kejriwal on Monday annou

Six Indian prisoners died in Pakistan in nine months, the Ministry of External Affairs said – not released even after completion of sentence

The neighboring country has kept the Indian citizens in Pakistani jails in a bad condition. The s

Kedarnath Yatra 2023: The doors of Kedarnath Dham were opened amidst the proclamation of 'Har Har Mahadev'

Today i.e. 25 April 2023, on Tuesday, the doors of Kedarnath Dham have been opened. As soon as th

Lokpal: Lokpal to be sensitive while redressing complaints, RBI governor appeals

The ombudsman should be sensitive while the redressal of customer complaints. The RBI Ombudsman a

UP New Cabinet: Know how the cabinet of Yogi Adityanath Government 2.0 will be, this strategy is being made

The BJP is very conscious about the formation of the cabinet after the victory in the 2022 Uttar

Risk of 56 diseases from cigarettes, research on Chinese: 1 million deaths annually due to smoking there; men more at risk

40% of the world's smokers live in China. According to recent research published in the Lancet Jo

Weather Update Today: Heavy rain from mountains to plains, havoc wreaked havoc in these states

Somewhere the weather has become pleasant due to the torrential rains that dominated the monsoon

Corona vaccination of 12-14-year-old children from today, people above 60 years of age will get vigilance dose

The war against the Covid-19 epidemic continues across the country. In this sequence, while the o

Sign up to write
Sign up now if you have flare of writing..
Login   |   Register
Follow Us
Indyaspeak @ Facebook Indyaspeak @ Twitter Indyaspeak @ Pinterest RSS



Play Free Quiz and Win Cash