FMCG firms face disruptions in Sept qtr due to GST reforms
Upbeat about future growth on favourable economic conditions
image for illustrative purpose
New Delhi: FMCG companies selling soap to soft drinks in the Indian market reported some impact on their sales in the September quarter from disruption owing to GST reforms, along with unusually heavy rains in parts of the country, but they see growth in the coming quarters, helped by favourable macro-economic conditions.
Leading global markers, including Unilever, Reckitt, Heineken, PepsiCo, and Coca-Cola, in their respective earnings calls, have mentioned challenges they faced due to disruptions in trade channels in September.
"Our emerging market performance is improving; India, in particular, is very well positioned over the medium term. The GST reform has had some impact in the short-term, but we believe it is very good news for 40 per cent of our portfolio with close to a 10 per cent price reduction," Unilever CEO Fernando Fernandez said.
British FMCG major Reckitt said its net revenue growth in India was impacted in the September quarter due to the implementation of new GST slabs; however, it reported volume-led growth in its germ protection brand Dettol.
Replying to a query in the earnings call, Reckitt CFO Shannon Eisenhardt said "the impact in Q3 of GST phasing being low to mid-single digits and that our India like-for-like was low single digit in Q3.” Reckitt CEO Kris Licht, who was also on the call, said the company has a very successful business in China and India.
“Both of those businesses have been delivering great performance now for a long time. We have a big opportunity to take the next tranche of markets to that level of excellence and execution, and that's a big focus at the moment in our emerging markets portfolio,” he said.
Dutch brewing major Heineken NV, which owns United Breweries Ltd (UBL) said its India beer volume has been impacted with a decline of "mid-single-digit" in the September quarter of 2025 on account of unusual heavy rains in parts of the country during the monsoon.
However, its organic net revenue grew by a 'mid-single-digit', which is largely supported by price hikes in some of the key states along with a portfolio mix.
