FMCG firms may see GST-cut impact in Q3

Fast-moving consumer goods (FMCG) companies are expected to reflect the transient impact of the new goods and services tax (GST) rates in the third quarter of 2025-26 (FY26) (October-December/Q3), with volume recovery likely to improve sequentially, according to brokerages.

- SHARLEEN D’SOUZA

Companies observed that supply chains focused on liquidating higher-priced inventory, which had adjusted following GST rate cuts on many FMCG products.

In its pre-quarterly update, Dabur India said: “During the quarter, early signs of demand recovery were witnessed, aided by GST rate revisions. In October, distributors and retailers focused on liquidating existing higher-priced inventory in the channel. After trade stabilisation, consumer sentiment improved in both urban and rural areas. Rural demand continued to outperform urban demand this quarter as well.”