Colgate Palmolive India has reported a net profit decline of 11.8% year-on-year to ₹321 crore for the first quarter ended June 30, 2025, compared to ₹364 crore in the same quarter last year. The leading oral care company attributed the decline in profit to higher raw material costs and promotional spending even as revenue showed a modest growth.
Financial Performance Snapshot: Q1 FY26
Financial Metric | Q1 FY26 | Q1 FY25 | YoY Change (%) | Q4 FY25 | QoQ Change (%) |
---|---|---|---|---|---|
Revenue from Operations | ₹1,365 crore | ₹1,309 crore | +4.3 | ₹1,312 crore | +4.0 |
EBITDA | ₹448 crore | ₹512 crore | -12.5 | ₹421 crore | +6.4 |
EBITDA Margin (%) | 32.8 | 39.1 | -630 bps | 32.1 | +70 bps |
Net Profit | ₹321 crore | ₹364 crore | -11.8 | ₹316 crore | +1.6 |
In its investor note, the company said that the operational performance was impacted by rising input costs, especially for packaging materials, and increased marketing investments to support new launches in the competitive oral care market.
Management Commentary
Prabha Narasimhan, MD & CEO of Colgate Palmolive India, said:
“We continue to prioritise premiumisation and innovation-led growth while investing behind our core brands. Despite headwinds on cost inflation, we have delivered revenue growth and maintained competitive market shares.”
She added that new launches under the Colgate Vedshakti and Colgate Visible White portfolios have received positive consumer response.
Key Business Highlights Q1 FY26
- Volume Growth: The company reported low single-digit volume growth driven by strong traction in rural markets and stable urban demand.
- Innovation Pipeline: New launches included Colgate Charcoal Clean toothbrushes and expanded Ayurvedic variants in toothpaste to attract health-conscious consumers.
- Market Share: Maintained leadership with >50% market share in toothpaste category despite intense competition from Dabur and Patanjali.
- Advertising and Promotion Expenses: Increased by 9.7% YoY to support brand campaigns, which impacted operating margins.
Segment-wise Revenue Contribution
Segment | Revenue Share (%) | Key Highlights |
---|---|---|
Toothpaste | 79 | Growth led by Colgate Strong Teeth and Vedshakti |
Toothbrush | 17 | Premiumisation driving average realisation |
Others (Mouthwash, etc.) | 4 | High growth base, focused retail expansion |
Cost Analysis: Major Pressure Points
1. Raw Material Costs
Higher prices for sorbitol, silica, and packaging resins led to an increase in cost of goods sold by 8.2% YoY, squeezing gross margins despite calibrated pricing actions.
2. Advertising and Promotion
The company increased marketing spends to defend market share amid heightened competition and FMCG slowdown concerns.
Expense Category | Q1 FY26 (₹ crore) | YoY Change (%) |
---|---|---|
Cost of Goods Sold | 513 | +8.2 |
Advertising & Promotion | 226 | +9.7 |
Employee Benefits | 122 | +3.5 |
Other Expenses | 92 | +4.8 |
Analyst Views
Brokerages maintained a cautious outlook on Colgate Palmolive India’s near-term earnings, citing gross margin pressures, though long-term fundamentals remain robust.
A senior FMCG analyst at a leading domestic brokerage said:
“Colgate is seeing volume stabilisation and premiumisation benefits, but raw material inflation and competitive intensity will keep margin recovery gradual.”
Market Share and Competitive Landscape
Despite the profit dip, Colgate Palmolive India retained its market leadership in oral care, outperforming Dabur and Patanjali in value market share, supported by its premium toothpaste variants and consistent rural distribution expansion.
Top Toothpaste Players in India (Market Share %)
Company | Market Share (%) | Key Brands |
---|---|---|
Colgate Palmolive | ~52 | Colgate Strong Teeth, Vedshakti, Visible White |
Dabur | ~18 | Dabur Red, Meswak |
Patanjali | ~10 | Dant Kanti |
Others | ~20 | Sensodyne, Closeup, Pepsodent |
Strategic Priorities Ahead
Prabha Narasimhan outlined the company’s focus areas for FY26:
- Premiumisation: Driving higher realisation through whitening, sensitive, and Ayurvedic segments
- Distribution Expansion: Enhancing direct reach in rural and semi-urban markets
- Innovation: Launching differentiated products aligned with evolving consumer preferences
- Cost Management: Implementing savings programmes to offset raw material inflation
Stock Market Reaction
Following the Q1 results announcement, Colgate Palmolive India shares closed at ₹2,121 on NSE, down 0.8% as investors weighed the margin contraction against steady revenue growth.
Outlook for FY26
The company maintained a cautious but optimistic outlook for the remainder of FY26, expecting mid-single digit revenue growth and gradual margin recovery driven by:
- Softening input costs in H2 FY26 if global commodity prices stabilise
- Innovation pipeline supporting premium segment growth
- Continued rural market recovery as FMCG consumption trends improve
Conclusion
Colgate Palmolive India’s Q1 FY26 results reflect strong brand resilience amid an inflationary environment and competitive pressures. While net profit dipped 11.8% due to higher costs, the company’s revenue growth, robust market share, and premiumisation strategy indicate a steady path forward in India’s evolving oral care market.
Disclaimer
This news content is for informational purposes only. It is not intended as investment advice. Readers are advised to consult financial experts before making any business or investment decisions based on this report.