Nestle India vs HUL: From Volume growth to management commentary, here is how two FMCG giants fared in Q2FY26

The Q2FY26 earnings season for the FMCG sector started with Nestle and Hindustan Unilever announcing their Q2FY26 results. Shares of Nestle India jumped over 6% post the Q2FY26 results, while Hindustan Unilever shares have fallen over 4% post result announcements. Earnings for the FMCG sector will continue to remain in focus as investors expect a turnaround in the outlook for the sector post the GST rationalisation reforms. Here is how Nestle India and Hindustan Unilever fared in Q2 FY26.

Topline and volume growth

The topline growth showed mixed trends, with Nestle India outperforming Hindustan Unilever on volume growth and topline growth. Hindustan Unilever continued to witness flat volume growth, consequently leading to modest 2% topline growth for the Q2FY26. While Nestle India reported superior topline growth numbers at 10.6%, which were driven by strong volume growth. Three out of four product categories of Nestle India delivered volume, leading to double-digit growth for the quarter. Meanwhile, two of the major segments for Hindustan Unilever showed flat volume growth, while the other two segments posted mid-single digit volume growth of 2-5%.

Operational efficiency

Poor volume and sales growth impacted the operational efficiency for Hindustan Unilever, while Nestle India continued its outperformance. At the operating level, the EBITDA (Earnings before interest, taxes and depreciation & amortisation) for the quarter for Hindustan Unilever declined by nearly 2% at ₹3,729 crore, and the EBITDA margin also contracted by 90 bps to 23.2%. On the other hand, Nestle India reported a 30 bps increase in EBITDA margin on a sequential basis. Strong volume led sales growth, helping Nestle India outperform its closest peers on an operational basis.

Outlook and management commentary

Despite the mixed trends in quarterly performance, the outlook for the FMCG sector remains buoyant. The GST rationalisation reforms are expected to show results in the coming quarters. Nestle India expects the reforms to stimulate consumption, drive affordability and contribute to the overall growth of the sector and economy. Similarly, Priya Nair, CEO and MD, said, “The latest GST reforms are a positive step by the Government to drive consumption, expected to increase disposable income and improve consumer sentiment”

For the overall outlook, Hindustan Unilever will focus on volume-led growth to accelerate our portfolio transformation by radically sharpening our consumer segmentation. While Nestle India aims to adapt to, “Fast, Focused and Flexible” strategy for future growth. The company aims to invest heavily in growth, brand building and capacity addition for bigger, bolder and better outputs.