Colgate Q2 Performance Impact of GST Cut, ETCFO
Colgate-Palmolive (India) Limited saw its operations affected in Q2 FY’26 after the government cut GST on oral care products from 18% to 5%, a move the company says boosted consumer savings but caused temporary disruptions at distributors and retailers.
Net sales for the quarter were Rs 1,507 crore, down 6.3% year-on-year but up 6.1% sequentially from Rs 1,421 crore in Q1 FY’26. Net profit after tax stood at Rs 328 crore, compared with Rs 395 crore a year ago. Adjusted for a one-time tax refund interest, profits declined 7.2%.
“During the quarter, GST rates on our entire oral care portfolio were reduced from 18% to 5%. We welcome this move by the government as this is a timely step in boosting consumer confidence while recognising oral health as a growing priority,” said Prabha Narasimhan, Managing Director & CEO.
She added, “Our second quarter performance also reflects the transitory disruption at distributors and retailers across channels caused by GST rate revision. Our first half performance cycles a high base of double digit net sales growth in the base period and we expect a gradual recovery in performance in the second half.”
Despite the disruption, Colgate maintained margin resilience through its Funding The Growth program and continued investing in premium products, led by Colgate Visible White Purple toothpaste.
The company also launched Palmolive’s Moments body wash range with natural extracts and patented fragrances, and rolled out the “CAVITY-PROOF” campaign under Colgate Strong Teeth, showcasing its 24-hour anti-cavity Arginine + Calcium Boost technology for children.
The board declared a first interim dividend of Rs. 24 per share.
The GST cut temporarily rattled distribution, but consumers benefit from lower prices. Colgate expects the market to stabilise in the coming months while staying focused on long-term growth.>
