Weather woes drag FMCG Q1 sales; urban demand recovery offers relief

The performance of FMCG companies in Q1 FY26 was adversely impacted by erratic weather and unseasonal rains, which affected key summer-centric categories.
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The performance of Fast-moving consumer Goods (FMCG) makers was affected by erratic weather conditions and unseasonal rains in Q1 FY26.

While analysts projected an impact on the summer portfolio business of fast-moving consumer goods companies, the unseasonal rainfall in May affected the Ready-to-Drink, beverages, and ice cream portfolio.

Dabur India stated that unseasonal rainfall during the peak summer months impacted its performance, particularly in Glucose, which saw a decline of 4.4 per cent during the quarter.

“While unseasonal rains during peak summer months impacted the performance of our summer-centric portfolio, particularly in categories like beverages and Glucose, our diversified product mix and agile supply chain helped cushion the impact and maintain overall momentum,” said Dabur India.

Tata Consumer Products stated that erratic weather impacted its RTD business in Q1.

“The growth businesses grew 7 per cent on an aggregate basis. This was below par in our parlance. It was primarily driven by unfavourable weather impacting the RTD business, as the monsoon came early. Despite that, we recorded positive volume growth,” said Sunil D Souza, Managing Director and Chief Executive Officer of Tata Consumer, in an investor call.

Analysts warn of decline in summer categories

“We expect the Summer portfolio across companies to be impacted on the back of the early monsoon. Companies with categories like juices, soft drinks, water, ice cream, and cooling hair oils can see the most impact, as we expect these categories to witness a year-on-year decline in sales,” said Nomura.

Sector leader Hindustan Unilever (HUL) mentioned that the ice cream segment reported high-single-digit volume-led growth, but the consumption was impacted.

“The performance in ice cream during the quarter was impacted by the early monsoon,” stated Ritesh Tiwari, HUL’s Chief Financial Officer.

However, the FMCG companies noted that during the quarter, they observed  a sustained and gradual recovery in urban demand. The market sentiment in the FMCG industry has improved over the last three months, and manufacturers are expecting consumption demand to remain stable in FY26.

Published on August 2, 2025