Godrej Consumer Products expects revival in demand in next 12-18 months

New Delhi: Godrej Consumer Products (GCPL) expects a revival in demand in the next 12-18 months, helped by tailwinds as lower food inflation, normal monsoon and pay commission, said Sudhir Sitapati, Managing Director and CEO, GCPL.

Besides, the Godrej Industries Group also expects its profit to go up again, once the palm oil prices, a key raw material for its soap business, come down, said Sitapati in a post earnings media briefing.

GCPL termed the persistent inflation as a "short-term blip", where it has passed on only 15–16% of the palm oil price increase to customers.

The company, which owns brands such as Cinthol, Godrej Fair Glow, Godrej No 1, Ezee, Goodknight, HITS, etc, has reported a consolidated net profit of Rs 411.9 crore in the March quarter, along with an underlying volume growth of 6%.

As per the strategy, GCPL is now focusing on categories that are underpenetrated and offers long runway of growth, such as hair colour, body wash and sexual wellness.

When asked about the outlook, Sitapati said, "FMCG volume growth peaks GDP growth. So if GDP growth is 6%, median volume growth in FMCG should be 7-7.5%. Over the last two years, it has been 4%. So there has been a 2-3% deviation, which I think is a short-term deviation, and it should come back."

Moreover, the government is also planning for a pay commission, which will help in the revival of the demand.

"There's also a pay commission, which is due in the next 12 months. We have seen in the past that every time there's a pay commission increase, FMCG does well. So, these are the reasons why, over the next 12 to 18 months, I feel like FMCG may see some sort of revival from where it is," he said.

Besides, El Nino effect took food prices up last year, which had an immediate impact on FMCG consumption.

"So now that El Nino has reversed, price inflation has come down in Jan, Feb, March, and we should see some kind of demand coming back," he added.

GCPL, which operates in the Household Insecticides with brand as HITS and GoodKnight, had a strong double digit volume growth.

For the financial year ended March 31, 2025, GCPL's net profit was at Rs 1,852.30 crore. Total consolidated revenue from operations was at Rs 14,364.29 crore, up 1.9%.

In FY25, GCPL's consolidated organic underlying volume grew at 4%.