FMCG players witness strong Q3 recovery

Driven by GST reforms, robust festive demand, and softening raw material prices, the FMCG industry expects volume-based growth, supported by a mid-single digit revenue rise and improved operating margins in the December quarter.

Photograph: Mansi Thapliyal/Reuters

After settling down of GST-led disruptions, where distributors and retailers focused on liquidating the existing higher-priced inventory in the channel, the FMCG companies have witnessed signs of recovery, major listed firms informed exchanges in their recent updates on the December quarter.

Moreover, post-trade stabilisation, consumer sentiment improved in urban and rural areas. However, in continuation with the previous trend, rural demand continued to outperform urban demand this quarter as well, FMCG companies like Dabur, Marico, and Godrej Consumer Products Ltd (GCPL) said.

The FMCG industry, which was facing slow consumption, now expects a sustained recovery in demand and improvement in revenue trajectory in the coming quarters.

Besides, in terms of channels, organised trade maintained its strong growth momentum, with e-commerce, including hyper-local delivery platforms, growing in strong double-digit.

“Within the India business, we expect the Home & Personal care business to grow in double digits on the back of strong growth in Hair Oils and Oral care category.

“Key brands, which are likely to record healthy volume-led growth, are Dabur Amla franchise, Dabur Almond, Dabur Anmol, Dabur Red Toothpaste and Meswak,” said Dabur in its updates.

The majority of its portfolio continued to outpace category growth and is expected to register market share gains during the quarter.

“Overall, we expect consolidated revenue to grow in the mid-single digits with operating profit and profit after tax to grow ahead of revenue,” Dabur said.

Similarly, GCPL also said that demand conditions in the domestic market strengthened progressively during the quarter.

“We remain confident of a gradual improvement in consumption over the coming quarters, supported by falling inflation and improving affordability, following lower GST rates,” said the FMCG arm of Godrej Industries Group (GIG).

It also expects “close to double-digit revenue growth in rupee terms and double-digit EBITDA growth” at the consolidated level, helped by domestic and improving trends across its international businesses.

Similarly, Marico, which owns several FMCG brands, including Saffola, Parachute, Hair & Care, Nihar and Livon, also expects an increase in consolidated revenue in the ‘high 20s’ for Q3, with margin improvement.

Marico said it has witnessed “steady demand” trends during the December quarter and remains “optimistic” about a gradual improvement in consumption in the quarters ahead.

This is supported by easing inflation, lower GST rates driving affordability, MSP hikes, and a healthy crop sowing season, Marico said in its December quarter updates to the bourses.

“During the quarter, underlying volume growth in the India business remained in high single digits, while marking a slight improvement on a sequential basis.

“Consolidated revenue growth on a year-on-year basis stood in the high twenties, poised to achieve our full-year aspiration,” Marico said.

Similarly, retailers like Trent, Titan and D-Mart reported a standalone growth in their updates.

Tata group firm Trent, which operates brands like Westside and Zudio, reported a 17 per cent growth in standalone revenue to Rs 5,220 crore in the third quarter of FY26.

Avenue Supermarts Ltd, which owns and operates the retail chain D-Mart, has reported an increase of 18.27 per cent in its consolidated net profit at Rs 855.78 crore and its revenue from operations rose 13.32 per cent to Rs 18,100.88 crore for the December quarter of FY26.

Titan Co Ltd, the country’s leading branded jewellery and watch maker, on Tuesday reported a 40 per cent growth in its standalone revenue in the December quarter of FY26, mainly led by surging gold prices.