Godrej Consumer Products Limited (GCPL) reported resilient Q2 FY26 results amidst GST transition in India and macroeconomic challenges in Indonesia. India’s business (excluding soaps) delivered double-digit volume growth. Consolidated revenue grew by 4%, with a 3% underlying volume growth. The company expects sequential strengthening through FY26, aiming for high single-digit underlying volume growth and anticipates improved performance in the second half of the year. They’ve also announced the acquisition of Muuchstac, a men’s grooming brand.
Financial Performance
Godrej Consumer Products Limited (GCPL) reported that in Q2 FY26, on a consolidated basis, revenue grew by 4% in INR terms, supported by 3% underlying volume growth. The EBITDA margin stood at 19.3%. Net profit before exception declined by 2%. The company highlighted a resilient quarter amidst GST transition in India and macroeconomic challenges in Indonesia.
India Business
In India, sales grew by 4% and volumes by 3%. New launches are performing well, with Godrej Fab and Goodnight Agarbatti gaining traction. The company entered the toilet cleaning category with the new brand, Godrej Spic, priced at INR79 for 500 ml in select South Indian states.
International Business
The Indonesia business delivered a stable UVG of 2% with market share gains, despite macro and pricing pressures. Africa, USA, and the Middle East delivered 25% sales growth in INR terms and 15% in constant currency, with 20% EBITDA growth, led by hair fashion and air fresheners.
Acquisition of Muuchstac
GCPL signed an agreement to acquire the FMCG business under the Muuchstac brand, a men’s grooming brand. Muuchstac has delivered roughly INR80 crores in revenue over the last 12 months and is already among the top brands online. The total face wash market is growing at 15% to 20%. The acquisition was made at approximately 4x of sales and 10x of EBITDA.
Outlook and Strategy
GCPL expects performance to strengthen sequentially through FY26. The company aims for high single-digit underlying volume growth in the standalone business and high single-digit revenue growth at a consolidated level. India standalone and GAUM businesses are expected to deliver double-digit EBITDA growth for the full year. Consolidated EBITDA growth may be marginally lower due to temporary pressures in international markets.
Q&A Highlights
During the question and answer session, the company addressed concerns about palm oil prices and margin guidance, stating that prices have been range-bound between MYR4,000 and MYR4,500. Discussions also covered the Indonesia business, with expectations for volume growth in the 2% to 4% range for the next few quarters.
The company is working towards delivering efficiencies and cost savings, expecting the savings from media spends to materialize. GCPL highlighted a shift in focus towards face wash with the Muuchstac acquisition, which is positioned largely on anti-acne and has a unique influencer model.
Source: BSE