What Consumer Goods Firms’ Q2 Earnings Say About India’s Economy
A customer browses cookies on display at a general store in Mumbai. (Photographer: Dhiraj Singh/Bloomberg)

What Consumer Goods Firms’ Q2 Earnings Say About India’s Economy

India’s consumer goods makers saw an improvement in volumes and revenue in the quarter ended September, suggesting that consumption is slowly recovering in Asia’s third-largest economy after one of the harshest Covid-19 lockdowns in the world.

Aggregate volume growth of Hindustan Unilever Ltd., Dabur India Ltd., Marico Ltd. and Godrej Consumer Products Ltd. stood at 8.45% compared with 4.45% a year earlier. It was driven by higher demand for food, hygiene and immunity-boosting products as majority of consumers avoided going outdoors in July-September.

Demand, however, is still largely driven by food products even as personal and home care categories are recovering slowly. That points to a slow recovery in a year the GDP is expected to contract first time in decades.

India’s consumer goods makers, despite being classified an essential service, faced supply-chain and labour issues as the lockdown forced workers to migrate back to hinterlands. Demand improved after the nation—fighting a rare recession—restarted most activities to boost sentiment and growth. Consumption was partly aided by rural demand.

Here’s what companies said:

Hindustan Unilever

“In the context of a challenging economic environment, our growth has been competitive and profitable,” Sanjiv Mehta, chairman and managing director at HUL, said in a post-earnings call of India’s largest FMCG company. “Rural markets have been resilient but demand in urban markets, especially metros has been muted,” he said. “The worst is behind us and we are cautiously optimistic on demand recovery.”

Also Read: HUL Q2 Results: Profit Rises Nearly 8%, Volumes Up As Demand Improves

Britannia Industries

While the government has ended the lockdown, it will take a while for the situation to normalise and the company closely watching the macro economic factors, changes in law, evolving consumer behaviour, Varun Berry, managing director of Britannia Industries, said after the earnings. The company is framing a medium-term strategy laying out scenarios to deal with the dynamic environment, he said.

Also Read: Britannia Q2 Results: Revenue, Profit Rise As Sales Jump Amid Unlocking

Dabur India

“While the sentiment in the ongoing quarter is better, festive demand is lower compared to last year,” Lalit Malik, chief financial officer at Dabur India, said. “There’s an improvement over the last quarter, sentiments are comparatively better, and the opening up of malls has helped.”


The maker of Parachute hair oil is focused on foods and wants to increase its share due to high tailwinds and aims to enter categories worth more than Rs 500 crore, Saugata Gupta, managing director and chief executive officer at Marico, told BloombergQuint.

Also Read: Marico Says Volumes Rose In Q2 Aided By Revival In Demand

Nestle India

The maker of Maggi instant noodles witnessed improved demand for its food products like noodles and sauces. Suresh Narayanan, the company’s chairman and managing director, said in a statement that demand for out-of-home channels have improved but continues to remain impacted due to the overall environment.

Also Read: Nestle India Q3 Results: Revenue Rises 10% As Demand Improves


The maker of Aashirwad atta reported double-digit growth for its food division while keeping costs under control. Cigarette volumes were, however, lower due to lockdown restrictions across the country.

Also Read: ITC Q2 Results: Profit Drops 20% On Lower Cigarette Sales

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.