Margins face mixed outlook as FMCG input costs diverge

Large FMCG firms may see margin relief in coming quarters despite ongoing price volatility

- Suneera Tandon

Prices of key inputs for the fast-moving consumer goods (FMCG) sector are moving in opposite directions, creating a mixed margin outlook for companies such as Hindustan Unilever Ltd, Marico Ltd and Parle Products Pvt. Ltd.

Several agricultural inputs and packaging materials, for instance, are getting cheaper, while other commodities such as sugar, coffee, and fishmeal are becoming more expensive, potentially producing an uneven impact on FMCG companies’ profit margins.

Industry analysts say that the coming quarters may bring margin relief in some pockets for large food, beverage and home-and-personal-care companies, even as price volatility persists in other key commodities.

“Considering current raw material inflation and GST 2.0 rollout, majority of the companies will witness volume-led growth in the second half of FY26, especially in food and beverages & beauty and personal care segments,” said Ronak Shah of Equirus Securities.