HUL Shares Fall After Weak Q2 Update, GST Rationalisation Impacts Sales

Shares of Hindustan Unilever Ltd (HUL) fell in trading on Monday, September 29, following a weaker-than-expected business update for the September quarter. The slowdown in sales was attributed to the recent Goods and Services Tax (GST) rationalisation, which altered pricing across key product categories.

HUL noted that under the revised GST rates, nearly 40 percent of its portfolio—including toilet soaps, toothpaste, shampoo, and hair oil—now benefits from a reduced GST rate of 5 percent, down from the previous 12–18 percent.

In its statement, the FMCG major said:

“HUL remains committed to supporting the Government’s efforts by ensuring that the GST benefits are passed on to consumers through competitive pricing and enhanced value across a wide range of products from 22nd September onwards. These reforms are expected to increase disposable income and drive long-term demand across key categories.”

However, the GST reduction led to postponement of orders as both distributors and consumers awaited products with the updated pricing. The delay in purchases across the portfolio caused a temporary slowdown in sales, particularly in pantry staples.

HUL emphasized that while the impact was short-term, the reforms are expected to stimulate consumer demand over the long term, benefiting both households and the broader FMCG market.