HUL, Colgate, Mondelez hike prices in January

Household budgets will get a little tighter with several FMCG products becoming costlier. Hindustan Unilever Ltd, Colgate Palmolive (India) Ltd and Modelez India have, in January, raised prices on a variety of products with the increase ranging between 2 per cent and 58 per cent, data from trade sources showed.

This is the third major hike by fast moving consumer goods companies since January 2022. The rise in raw material costs had propelled companies to also hike prices in May to offset input costs and protect their margins.

September quarter results showed that profitability margins of most companies in the segment were under pressure as they were holding high-cost inventory.

Colgate and Mondelez did not respond to e-mails sent to them seeking clarification on the price changes, till the time of going to press. HUL said it has no comments to offer.

Trade data showed that Hindustan Unilever has increased prices of products such as washing soaps, detergents and washing powders in the range of 2.6 to 12.5 per cent. This includes popular brands such as Pears, Wheel, Vim, Surf Excel and Rin bars. It, however, reduced the price of Lifebuoy soap. In absolute terms, the increase is between ₹1 and ₹22 . In a couple of items, it has reduced the grammage while keeping the maximum retail price intact.

Mondelez India has raised prices of its confectioneries in the range of 3.4-17 per cent, translating into ₹4-10 increase in absolute terms. Items included Bournvita jar and biscuits, Oreo and Chocolairs, among others. In some categories such as Perk, it has reduced grammage while keeping the price the same.

Dental hygiene products maker Colgate Palmolive ( India) Ltd has raised its product prices by 5-58 per cent, the actual price increase being in the range ₹2 to ₹49.

While commodity prices have been softening through the second half of 2022, earlier price hikes taken by companies have not been in the same proportion as the rise in raw material costs.

This may, however, be the last price hike as indications are that prices of fast moving consumer goods are moving southwards, especially in the personal and home care products categories.

Analysts said that prices of personal and homecare products may drop in the coming months, driven by lower input costs. “Palm oil is trending lower and that bodes well for maintaining lower input costs, not just for the industry but also for associated products,”said Akshay D’Souza, Chief of Growth & Insights at Bizom, a retail intelligence platform.

Palm oil is a key ingredient in personal care products including soaps, shampoos.

As far as chocolates and confectioneries are concerned, prices would still have an upward bias, especially milk and dairy-based products. Crop damage due to unseasonal rainfall in some areas and spread of Lumpy Skin Disease in many States has affected milk production.

On Thursday, shares of Hindustan Unilever ended 0.4 per cent lower at ₹2,583.05 on the National Stock Exchange, while Colgate shares ended almost flat at ₹1,487.

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