Leading FMCG manufacturers have expressed optimism on consumption trends, growth prospects and margin improvement for the current financial year, although they continue to monitor inflation pressures and the potential impact of El Nino-induced weather instability.
Fast-moving consumer goods (FMCG) companies said in their respective first quarter business updates that demand conditions remain resilient, supported by steady economic activity, while softening commodity prices are expected to progressively improve margins in the coming quarters.
Companies like Dabur India, Godrej Consumer Products Ltd (GCPL) and Marico have reported strong business momentum in the June quarter and are optimistic about consumption trends for the rest of FY27 despite inflationary pressures, commodity volatility and geopolitical uncertainties.
Marico expects its consolidated revenues to grow in the early twenties, while GCPL is expected to achieve high-teens growth. Similarly, Dabur also expects double-digit growth in consolidated revenue and profit after tax for the quarter ending June 30, 2026.
FMCG companies also expressed their concerns over increased input costs and sourcing challenges during this period.
GCPL said input costs remained high for most of the April-June quarter, but have started declining in the last weeks of the period.
“On the commodity front, input costs remained high for most of the first quarter, broadly within the cost impact range outlined in our previous update. What is encouraging is that costs have started to come down in the final weeks of the quarter,” the Godrej Industries Group (GIG) group company said.
The company said it expects margins to progressively improve during the year through calibrated pricing actions, cost-saving initiatives and media optimization efforts.
“Our response has been in line with our established approach of controlling commodity cycles, calibrated pricing actions, strong delivery on cost-saving programs and judicious media optimization, and we expect margins to improve progressively during the year,” said GCPL, which owns popular brands such as Good Knight, HIT, Easy, Cinthol and Godrej No. 1.
However, it is “conscious” that El Nino conditions could increase “weather volatility in our key markets” with the potential to disrupt agricultural production and rural demand.
GCPL said its geographically diverse sourcing network and portfolio provides resilience against such risks, and no major impact is expected.
“With revenue growth tracking ahead of our original expectations and input costs declining, we enter the remainder of FY27 with increased confidence. We remain firmly on track to deliver our guidance for the full year with a strong likelihood of exceeding it in select metrics.”
According to Dabur, it continues to focus on its strategic priorities, which aim to improve consumption trends, enhance cost competitiveness, leverage digital capabilities and deliver sustainable and profitable growth in the medium to long term.
Dabur said that overall the underlying fundamentals of the business remain strong.
It expects consumption to improve in the coming quarters in its international markets, which contribute about a quarter of its consolidated revenues, as the situation in West Asia stabilises.
Additionally, “domestic demand trends remain encouraging, with growth momentum continuing in both rural and urban markets, with rural markets outperforming urban centres,” said the company, which works with brands such as Dabur Chyawanprash, Dabur Honey, Dabur Honeytuss, Dabur Pudinahara and Real.
Dabur said it is focused on its key growth priorities and is well positioned to benefit from improving demand, enhance cost competitiveness, utilize digital capabilities and deliver sustainable, profitable growth in the medium to long term.
Marico said demand trends remained stable during the quarter, supported by resilient economic activity.
“Looking ahead, we remain optimistic about consumption trends, while closely monitoring the emerging inflation situation and the impact of El Nino on the monsoon,” it said.
The company, which owns the Parachute, Nihar, Hair & Care, Saffola and Livon brands, maintains its aspiration to deliver sustainable and profitable volume-led growth in the medium term, enabled by the strong brand equity of its core franchises and the scale of new growth engines in the markets.