FMCG price hikes set to continue as input costs rise, Nuvama says

Nuvama expects 10–15% input-cost inflation to keep FMCG pricing elevated, with larger players such as HUL, ITC, Marico and Pidilite better placed to protect margins and gain share from smaller rivals.

— Source publishedFri, 18 Sept, 2026, 10:46 IST·First seen Fri, 18 Sept, 2026, 10:51 IST·Source CNBC-TV18 · Retail

What happened

Hindustan Unilever · Indian FMCG companies are expected to sustain price hikes amid 10-15% input inflation. Nuvama sees manageable margin pressure as ad

Key facts

  • Input-cost inflation: 10-15%
  • Typical price hikes: about 5%
  • Pidilite and paint-company price hikes: double-digit
  • HUL price hike: almost 7%
  • Expected EBITDA-margin pressure: 50-150 basis points
  • HUL near-term EBITDA-margin guidance: 22.5-23.5%
  • HUL long-term EBITDA-margin guidance: 22-24%
  • Crude oil factored in: about $100/barrel
  • Potential further price hikes if crude reaches $120/barrel
  • Asian Paints EBITDA-margin range: 18-20%

Why this matters

Rising input costs could create acquisition or partnership opportunities among smaller FMCG brands and suppliers that lack the scale to absorb 10–15% cost inflation.

What to watch

  • Crude oil sustaining above $100 per barrel and resulting moves in freight, HDPE/LLDPE, surfactants and other petrochemical-linked inputs.
  • Quarterly FMCG volume growth versus value growth, especially in mass-market and rural portfolios.
  • Management commentary on additional price hikes, grammage reductions, promotional spending and gross-margin guidance from HUL, ITC, Marico and Pidilite.
  • NielsenIQ/Kantar indicators of private-label, local-brand and small-pack share gains.
  • Rural wage growth, food inflation and consumer-confidence trends that determine tolerance for further price increases.
  • Competitive responses from smaller FMCG firms, including discounting, channel-credit stress or reduced advertising.
  • Use phased, category-specific pricing rather than broad list-price increases; protect entry price points through smaller packs and targeted grammage changes.
  • Shift marketing and trade-spend toward high-penetration, essential categories where brands retain pricing power.
  • Lock in or hedge key packaging, freight and commodity exposures where feasible; deepen supplier negotiations and reformulation efforts.
  • Increase distribution intensity in rural and value channels to defend volumes as consumers downtrade.
  • Monitor and selectively acquire or displace weaker regional competitors facing working-capital and margin stress.

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