Consumer Goods Makers Including Hindustan Unilever and Dabur Expect Volume Led Growth as Inflation Eases

India’s consumer goods and appliance manufacturers are preparing for a shift in growth dynamics as macroeconomic conditions begin to stabilise. After a period in which revenue expansion relied largely on price increases and premium product sales, companies now expect demand volumes to play a larger role in driving growth. 

Easing inflationary pressures, supportive tax changes and improving consumer sentiment are contributing to expectations of broader consumption recovery in the coming financial year.

Shift from Price Led to Volume Led Growth

Consumer goods companies indicate that future expansion is likely to be supported more by higher sales volumes rather than price hikes. 

During recent quarters, revenue growth across the sector was driven largely by pricing actions and premiumisation strategies adopted to offset cost pressures.

Executives now suggest that achieving growth through volumes reflects stronger underlying demand conditions, particularly among mass-market consumers who were affected by earlier inflationary pressures.

Corporate Outlook on Demand Recovery

At Dabur India, management noted that growth in the coming year is expected to rely more on consumption recovery than pricing measures. Similarly, Hindustan Unilever has prioritised volume expansion, reporting improved underlying volume growth in recent quarterly results.

Company leadership indicated that macroeconomic indicators, including consumer sentiment and purchasing activity, are showing gradual improvement, supporting expectations of stronger demand ahead.

Industry Data Signals Gradual Improvement

Market research data suggests FMCG volume growth has remained moderate during the current financial year but is showing signs of stabilisation. Growth levels have remained steady across recent quarters, with projections indicating a gradual pickup as the year progresses.

Value growth in the sector has continued to benefit from a combination of increased volumes and pricing adjustments, although companies expect pricing contributions to moderate as inflation pressures ease.

GST Cuts Expected to Support Mass Consumption

Tax reductions on select daily-use products are expected to improve affordability and encourage higher consumption. At Godrej Consumer Products, management highlighted that categories such as soaps could see renewed demand as lower prices help revive household purchasing.

Industry participants believe that easing cost pressures combined with policy support may particularly benefit essential product categories, which are closely tied to mass-market demand.

Consumer Durables See Seasonal Demand Opportunities

Appliance manufacturers are also anticipating improved demand, especially for cooling products such as air-conditioners and refrigerators. 

Companies including LG Electronics India, Blue Star Limited, Voltas Limited and Havells India expect seasonal demand to strengthen, supported by pent up purchases and a comparatively weaker base from the previous year.

Executives also pointed to low penetration levels in several appliance categories, suggesting room for incremental demand as consumers resume deferred purchases.

Renewed Focus on Entry Level Products

Over recent years, growth in home appliances has been driven largely by premium and mid-range offerings. Companies are now revisiting entry-level product segments to attract price-sensitive consumers and expand market reach.

This strategic adjustment reflects an effort to capture broader demand recovery rather than relying solely on higher-value product sales.

Read More: FMCG Companies Raise Prices by Up to 5% as Cost Pressures and Weak Rupee Impact Margins.

Conclusion

Consumer goods and appliance manufacturers expect the coming financial year to mark a transition towards volume led growth as inflation moderates and affordability improves.

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