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Demand recovery in sight

DABUR released its pre-quarterly update for 2QFY26. Here are the key highlights:

GST reform impact

* The government’s recent GST rate cut (from 12%/18% to 5%) across FMCG categories marks a landmark reform aimed at driving affordability and enhancing purchasing power.

* This move is expected to boost consumption across categories, strengthening demand in both urban and rural markets.

* Around 60% of Dabur’s India business (covering Oral Care, Juices, Hair Oils, Shampoo, Digestives, OTC, Branded Ethicals, and Culinary) will benefit directly from this rate reduction.

* After this reform, ~85% of Dabur’s portfolio now falls under the 5% GST bracket, a structural positive for long-term growth.

* Dabur has committed to passing on the GST benefits to consumers through lower MRPs.

* Following the GST Council’s Sep’25 announcement, temporary trade disruption occurred as consumers deferred purchases to benefit from lower prices and distributors/retailers liquidated higher-priced inventory. This led to short-term sales moderation in September and 2QFY26.

* Despite this, retail offtakes remained resilient, helping Dabur sustain market share gains across 90%+ of its portfolio.

Segmental Performance

Home & Personal Care

* Oral Care: Continued its strong growth trajectory, with both Red Toothpaste and Meswak expected to deliver double-digit growth. Growth is supported by robust execution and focused marketing initiatives.

* Skin Care: Expected to grow in high-single digits, led by Gulabari and Oxy franchises.

* Hair Care: Shampoos are anticipated to record high single-digit growth, led by Vatika. Hair Oils are expected to deliver mid-single-digit growth. Home Care: Odonil franchise reported a strong performance.

Healthcare

Key brands such as Dabur Honey, Honitus, Hajmola franchise, and Health Juices are likely to deliver double-digit growth, driven by strong volume momentum.

Foods & Beverages (F&B)

* Culinary: Expected to post double-digit growth, supported by robust performance in Oils & Fats.

* Beverages: Focus on the premium ‘Activ’ range is yielding positive traction. Activ portfolio (including Activ Juices & Coconut Water) is expected to grow 30%+ YoY. However, heavy rainfall and flooding in Jul-Aug’25 impacted overall beverage portfolio performance.

E-commerce (including Quick Commerce) is expected to grow in double digits and modern trade maintained its steady growth momentum.

International business

* Strong performance is expected in MENA, Turkey, Namaste, and Bangladesh. Nepal business was adversely impacted by the political unrest. Overall, international business is expected to deliver mid-single-digit growth in both INR and constant currency (CC) terms.

Consolidated performance & outlook

* Consolidated revenue is expected to grow in mid-single digits in 2QFY26. Operating profit is likely to grow in line with revenue.

* Despite temporary disruption due to the GST transition, underlying demand remains strong.

* With supportive macro conditions and benefits from GST rate cuts, consumption momentum is expected to accelerate in the coming quarters.

* Dabur remains well-positioned for a recovery and steady market share expansion across key categories.

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