Hindustan Unilever Limited (HUL) said on Friday, September 26, that its sales in September were hit by temporary disruptions following recent changes in Goods and Services Tax (GST) rates. In a filing to the BSE, the company noted that while nearly 40 per cent of its portfolio now falls under a lower 5 per cent GST slab, the transition led to lower orders from distributors and retailers clearing older inventory.
40 per cent of products under 5 per cent GST
The government’s latest GST reforms have reduced tax rates on categories such as toilet soaps, toothpaste, shampoo, hair oil, talcum powder, lifestyle nutrition and several food items. These products which previously attracted 12 or 18 per cent GST, now face a 5 per cent rate. HUL said it began passing on the benefit to consumers from September 22, through price cuts and enhanced value offerings. The company expects the move to lift disposable incomes and support long-term demand across categories.
Inventory adjustment hits near-term demand
The shift in tax slabs created a short-term disruption in September as distributors and retailers delayed orders in anticipation of lower-priced supplies. Consumers also postponed buying household products until updated stocks reached the market.
HUL said these adjustments have had a knock-on effect on sales across its portfolio and could continue through October, given existing inventory in the trade channels.
Q2 growth forecast muted, recovery expected in November
The company expects consolidated business growth for the quarter ending September 30, 2025 to be “near flat to low single digit.” It described the weakness as transitory and projected a recovery from November as supply chains stabilise and household spending rises. HUL will release its detailed financial results for the September quarter following board approval on October 23, 2025.
Stock reaction
Shares of HUL ended the day at Rs 2,510.85 on the BSE, down 1.07 per cent from the previous close of Rs 2,538.05. The stock opened at Rs 2,522.65.
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