Godrej Consumer Products Limited (GCPL) demonstrated resilience in its Q2 FY2026 performance, navigating through GST transition impacts in India and macroeconomic challenges in Indonesia. The company also announced a strategic acquisition to bolster its personal care portfolio.

Financial Highlights

GCPL reported consolidated sales growth of 4.00% year-on-year in both INR and constant currency terms for Q2 FY2026. This growth was underpinned by a 3.00% increase in underlying volume. Key financial metrics include:

• Standalone business: 4.00% sales growth with 3.00% underlying volume growth
• Indonesia: 7.00% sales decline in constant currency and INR terms, despite low mid-single-digit volume growth
• Africa, USA, and Middle East: 25.00% sales growth in INR (15.00% in constant currency)
• Consolidated EBITDA margin: 19.30%
• Consolidated net profit: 2.00% year-on-year decline (excluding exceptional items and one-offs)

Segment Performance

India Business

The India business grew by 4.00% in sales and 3.00% in volume, despite short-term disruptions from GST rate reductions. Notable segment performances include:

• Home Care: 6.00% growth, driven by strong performance in Air Fresheners and Fabric Care
• Personal Care: 2.00% decline, primarily due to GST-related impact on soaps

International Business

• Indonesia: Faced ongoing macro and pricing pressures, with a 7.00% revenue decline
• Africa, USA, and Middle East (GAUM): Delivered robust 25.00% sales growth in INR terms (15.00% in constant currency) and 20.00% EBITDA growth

Strategic Acquisition: Muuchstac Brand

GCPL announced the acquisition of the Muuchstac brand from Trilogy Solutions Private Limited. Key details of the acquisition include:

• Muuchstac is a fast-growing men's grooming brand with a strong position in the men's facewash segment
• The brand recorded revenues of approximately ₹80 crore and adjusted EBITDA of around ₹30 crore over the twelve months ending September 2025
• The acquisition is structured as a slump sale, with a gross business valuation of ₹380 crore for the first tranche (76% payment)
• The deal includes a performance-based second tranche payment after 12 months, with the total gross payment expected to be between ₹400-500 crore

Management Commentary

Sudhir Sitapati, Managing Director and CEO of GCPL, commented on the results: "Q2 FY26 has been a resilient quarter for GCPL, especially given the backdrop of the GST transition in India and continued macroeconomic challenges in Indonesia. Despite these headwinds, our India business, excluding soaps, has delivered double-digit underlying volume growth, reflecting the strength of our core portfolio and execution."

Regarding the Muuchstac acquisition, Sitapati added: "We are delighted to welcome Muuchstac brand to Godrej Consumer Products. The brand's strong resonance among younger consumers, high profitability, and proven digital execution model make it a powerful addition to our Personal Care portfolio."

Outlook

GCPL expects performance to strengthen sequentially through FY26, with the second half anticipated to deliver a stronger trajectory. The company remains confident in achieving high single-digit underlying volume growth in its Standalone business and high single-digit revenue growth at a consolidated level.

This article is for informational purposes only and should not be considered as financial advice. Always consult with a qualified financial advisor before making investment decisions.

Godrej Consumer Products Limited (GCPL) demonstrated resilience in its Q2 performance, navigating through GST transition impacts in India and macroeconomic challenges in Indonesia. The company reported a 4% year-on-year growth in consolidated sales, supported by a 3% increase in underlying volume growth.

Financial Highlights

• Consolidated revenue grew by 4% to ₹3,802.46 crore
• EBITDA margins stood at 19.3%
• Net profit (without exceptional items and one-offs) declined by 2% year-on-year

Segment Performance

India Business

• Sales grew by 4% to ₹2,362.00 crore with a 3% volume growth
• Home Care segment grew by 6%
• Personal Care segment declined by 2%, primarily due to GST transition impacts

The recent GST rate reduction, while causing short-term trade disruptions, may strengthen long-term consumer demand. GCPL has already passed on the benefits to consumers.

International Business

• Indonesia: Delivered 2% underlying volume growth, but sales declined by 7% in constant currency terms
• Africa, USA, and Middle East: Reported 25% sales growth in INR terms (15% in constant currency)

Category Insights

Home Care

• Household Insecticides: Electrics gaining market share; Incense sticks now the largest branded stick in the category
• Air Fresheners: Continued strong growth trajectory and market leadership
• Fabric Care: Delivered strong growth momentum and market share gains
• New Launch: Entered the Toilet Cleaners category with Godrej Spic

Personal Care

• Personal Wash: Most impacted by GST transition but continued to gain market share
• Hair Colour: Continued market share gains across Crème and Shampoo Hair Colour
• Perfumes & Deodorants: Delivered strong performance

Strategic Acquisition

GCPL announced the acquisition of the 'Muuchstac' brand, a fast-growing men's grooming brand with a strong position in the men's facewash segment. This strategic move aims to strengthen GCPL's presence in the high-growth men's grooming category.

Key acquisition details:

• Muuchstac recorded revenues of approximately ₹80.00 crore over twelve months
• EBITDA of around ₹30.00 crore, reflecting strong profitability
• Acquisition to be completed via slump sale from Triology Solutions Private Limited

Outlook

GCPL expects performance to strengthen sequentially, with the second half projected to deliver a stronger trajectory. The company remains confident in achieving:

• High single-digit underlying volume growth in the Standalone business
• High single-digit revenue growth at a consolidated level
• Double-digit EBITDA growth for India (Standalone) and GAUM businesses

Despite temporary pressures in international markets, GCPL maintains confidence in its strategy, portfolio resilience, and brand strength to deliver sustainable and profitable growth in the coming periods.

Sudhir Sitapati, Managing Director and CEO of GCPL, commented, "Q2 has been a resilient quarter for Godrej Consumer Products Limited, especially given the backdrop of the GST transition in India and continued macroeconomic challenges in Indonesia. Our India business, excluding soaps, has delivered double-digit underlying volume growth, reflecting the strength of our core portfolio and execution."

As GCPL navigates through these transitional challenges, the company's focus on innovation, operational excellence, and strategic acquisitions positions it well for future growth in the dynamic FMCG landscape.

Financial Performance Table