GST rate cuts impact biz, Dabur likely to see mid-single digit growth in Q2

Dabur India expects to clock mid-single digit consolidated revenue during the second quarter of the financial year 2026 (Q2FY26) due to GST rate rejig, even as the FMCG major asserted that the indirect tax reform will boost purchasing power and jack up consumption in the long run.

 

The maker of Real fruit juice said it faced “short-term moderation in sales” in the second quarter, adding that its operating profit will grow in line with the consolidated revenue.

 

The company’s key categories like oral care, juices, hair oils, shampoo, digestives, over-the-counter medicines, branded ethicals and culinary, which represents approximately 60 per cent of its India business will benefit from the GST rate cut from 12 per cent and 18 per cent to 5 per cent.

 

“Now 85 per cent of our portfolio is at a GST rate of 5 per cent, which is a key positive,” it stated.

 

“Distributors and retailers also focused on liquidating the existing higher-priced inventory. This resulted in a short-term moderation in sales during the month of September and, consequently, in Q2FY26,” the company stated in its quarter update.

 

However, its non-GST impacted brands like Dabur Honey, Anmol Coconut Oil, Gulabari and Hajmola Zeera performed well, the company said, adding “retail offtakes continued to be resilient, enabling us to sustain market share gains in over 90 per cent of our portfolio.”

 

The company’s oral care portfolio continued to witness “strong growth trajectory”, with double digit growth expected in both Red Toothpaste and Meswak. Meanwhile, its skin care portfolio is expected to grow in high-single digits led by Gulabari and Oxy franchise, and the hair care portfolio, shampoos are expected to register high-single digit growth led by Vatika.

 

“In healthcare, key brands such as Dabur Honey, Honitus, Hajmola franchise and health juices are likely to register double-digit growth underpinned by strong volumes,” the company further said.

 

However, higher than expected rainfall and floods in July, impacted its overall beverage portfolio.

 

“In beverages, our strategy of focusing on the premium ‘Activ’ range is yielding positive results. This quarter the Activ portfolio is expected to report robust growth of over 30 per cent, led by both Activ juices and coconut water,” it stated.