Dabur India’s Q2 sales were hit by GST-related disruption but the company expects demand to rebound as lower tax rates lift rural consumption
Fast-moving consumer goods maker Dabur India said on Tuesday that its sales during the second quarter ended 30 September were temporarily affected as customers deferred purchases and distributors cleared old stocks following the government’s recent Goods and Services Tax (GST) rate cuts.
The GST Council reduced rates in September across categories such as oral care, juices, shampoos, hair oils, digestives and culinary products from 12–18 per cent to 5 per cent. These segments account for nearly 60 per cent of Dabur’s India business, and the company said about 85 per cent of its overall portfolio now falls under the 5 per cent tax bracket.
The transition led to short-term disruption in September as buyers waited for lower prices and retailers liquidated higher-priced inventory. Dabur said it expects consolidated revenue for the quarter to rise in mid-single digits, with operating profit growing in line with sales.
Category-wise, oral care brands Dabur Red and Meswak are expected to post double-digit growth, while shampoos and skincare lines are likely to deliver high single-digit gains. Healthcare products such as Dabur Honey, Honitus and Hajmola also reported double-digit growth. Premium beverages under the Real Activ range grew more than 30 per cent, though overall beverages were impacted by heavy rains and floods during July and August.
International business recorded mid-single digit growth, supported by MENA, Turkey and Bangladesh, though operations in Nepal were disrupted by political unrest. E-commerce and quick commerce channels continued to post double-digit gains.
Despite the September slowdown, the company said it expects consumption to pick up in the coming quarters as lower GST rates improve affordability and rural demand strengthens.
Shares of Dabur India rose 1.5 per cent in afternoon trade following the quarterly update, but closed at Rs 490.75 for this week.
