Emami Q2 FY26 Results: Revenue ₹799 Cr, PAT ₹148 Cr; GST reset hurts near-term, H2 outlook positive

Emami Q2 FY 2025–26 Financial Report, Management Guidance & Comparative Table (Q2 FY26 vs Q1 FY26 vs Q2 FY25)

Emami Limited—home to power brands like Navratna, BoroPlus, Zandu, Kesh King and the re-positioned Smart & Handsome—reported a soft Q2 FY 2025–26 as India’s GST rate reset created near-term channel disruption. The company called the reform structurally positive (more affordable MRPs and higher portfolio coverage at the 5% slab), but acknowledged that September stocking was deferred as distributors cleared higher-tax inventory and awaited new price-marked packs. As a result, topline moderated even though underlying demand for non-impacted categories stayed healthy.

From an investor’s lens, gross margin resilience, disciplined costs, and confidence in a stronger H2 stand out, even as revenue and profit declined YoY and QoQ. Below is a concise narrative of what moved the quarter, followed by a detailed analysis and a clean comparison table you can reuse in your story.

Quick snapshot of Q2 FY26

• Revenue: ₹799 crore, down 10% YoY (vs ₹891 crore in Q2 FY25) and down ~11.6% QoQ (vs ₹904 crore in Q1 FY26).

• Gross Margin: 71.0%, broadly stable YoY (vs 70.7% in Q2 FY25) and up 160 bps QoQ (vs 69.4% in Q1 FY26).

• EBITDA: ₹179 crore, down 29% YoY (vs ₹250 crore) and ~16% QoQ (vs ₹214 crore).

• PAT: ₹148 crore, down 30% YoY (vs ₹213 crore) and ~10% QoQ (vs ₹164 crore).

• Dividend: Interim dividend 400% (₹4 per share) for FY26.

• Non-GST-impacted portfolio: Up 10% YoY in Q2—evidence that underlying demand remains intact where pricing/transition didn’t interfere.

Management commentary & guidance (what to expect in H2 FY26)

Emami calls the GST 2.0 step “structurally positive”: ~93% of the core domestic portfolio now sits in the 5% GST bucket (up from 12%/18% earlier for many SKUs). The company passed through the rate cuts to consumers, implying 7–13% MRP reductions across ~293 products / 497 SKUs—a lever that should bolster affordability and widen reach, especially in value-sensitive rural markets. However, the implementation timing overlapped with winter pipeline loading, which got deferred into October, crimping Q2 reporting.

Leadership flagged three encouraging signals for H2:

1. October rebound: Trade sentiment and winter loading recovered after the GST transition, putting Emami on “a solid footing for the second half.”

2. Non-impacted portfolio growth: 10% growth in categories unaffected by GST transition shows the core demand engine is healthy.

3. Premiumisation & innovation: Continued portfolio upgrades (e.g., Kesh King Gold relaunch; Smart & Handsome expansion into sunscreens, shower gels, serums, etc.) should help mix and brand power, supporting margin and medium-term growth.

The international business (exposure across MENAP, SAARC, SEA, Africa) delivered 8% growth despite macro/geopolitical noise—another cushion heading into H2.

Deep dive: What drove the quarter

1) GST transition: short-term pain for long-term gain
Channel partners held back orders in September to avoid holding higher-MRP inventory ahead of the rate cut and new price-labeled packs. This mechanical destocking weighed on reported sales. Emami’s choice to quickly pass on the GST cuts demonstrates a consumer-first stance and should unlock volume elasticity once the new MRPs stabilize at retail.

2) Summer portfolio weakness repeated
Weather again pinched volume in talc/prickly heat categories, coming off a strong base. This is transient and seasonal, not structural; the company’s two-year CAGR commentary (for talc/PHP) and innovation in cooling & hygiene formats provide medium-term comfort.

3) Margins held up well
Despite the revenue dip, gross margin stayed around 71%, aided by soft inputs and pricing discipline. EBITDA, naturally, de-levered on the lower topline but cost control limited downside. PAT decline mirrors EBITDA trajectory.

4) Innovation & brand upgrades

• Smart & Handsome: 12 new SKUs in male grooming (sunscreens, shower gels, under-eye creams, deos, face serums, sheet masks).

• Kesh King Gold: refreshed packaging, sharper positioning, upgraded formulation with Gro Biotin and Plant Omega 3-6-9.

• Zanducare: added Good Gut Cleanse & Detox shots and Acidity & Bloating Relief tablets.
  These steps back the premiumisation thesis and create non-seasonal growth pools.

5) International business steady
An 8% rise, with Creme 21 extensions (Xtra Bright, Xtra Cocoa, Papaya ranges) expanding the skincare shelf. This diversification matters if domestic seasonality hits a quarter.

Comparative earnings table

Sources: Q2 FY26 press release; Q1 FY26 press release; Q2 FY25 press release.

Growth math (for your copy):

• YoY (Q2 FY26 vs Q2 FY25): Revenue –10.3%, EBITDA –28%, PAT –30.5%; Gross Margin +30 bps.

• QoQ (Q2 FY26 vs Q1 FY26): Revenue –11.6%, EBITDA –16.4%, PAT –9.8%; Gross Margin +160 bps.

What this means for investors and the street

In consumer staples, policy resets often distort one quarter before normalizing. Emami’s case fits that pattern. The rate cut should gradually stimulate volumes—particularly in mass & rural—as new MRPs flow through shelves and distributors rebuild inventories. With October recovery already signalled, H2 may look cleaner, aided by the winter portfolio (BoroPlus & healthcare) and the wider 5% GST footprint that makes pricing more attractive.

Two indicators to track in the coming quarters:

1. Volume elasticity post-GST: Look for volume growth in previously 12%/18% GST categories as MRPs step down 7–13%. Emami’s breadth at 5% GST (~93% of core) is a competitive lever.

2. Mix & premiumisation: The Kesh King Gold relaunch and Smart & Handsome adjacency plays should improve mix and support gross margin sustainability above 70% through cycles.

Risk watchlist: (i) unseasonal weather again crimping summer categories, (ii) geopolitics in key international markets, and (iii) a slower-than-expected channel normalization post-GST. That said, cost discipline, high brand salience, and innovation cadence provide buffers.

Story-ready narrative (1000+ words, human tone)

Quarter two of FY 2025–26 was never going to be a quiet one for Emami. In early September, India pressed the reset button on GST rates for a wide basket of FMCG products. Emami did the consumer-friendly thing—cut prices and pass the benefit through—but the move also meant distributors and retailers paused fresh orders, cleared older packs with higher MRPs, and waited for the new labels. Add a late monsoon-skewed season that hurt the cooling categories, and you get a quarter where the underlying engine was humming but the reported numbers blinked amber.

The headline numbers capture this transition. Revenue landed at ₹799 crore, down 10% year on year and ~12% sequentially. EBITDA came in at ₹179 crore, lower as operating leverage rolled over on the softer topline. PAT was ₹148 crore, down 30% versus last year’s festive quarter. Yet buried in the release are two quiet positives most investors will care about. First, gross margin held at 71.0%, essentially flat to last year and up 160 bps QoQ, proof that input costs are benign and brand-led pricing is intact. Second, categories outside the GST transition grew 10%—a clean read that consumers are still buying when shelf prices and supply aren’t in flux.

If Q2 was about threading a reform needle, Q3 and Q4 are about acceleration. Management says October already turned the corner, with winter loading resuming after the one-off pause. The GST math itself is structurally attractive: about 93% of Emami’s core domestic portfolio now sits at 5% GST, which should widen affordability and sharpen competitiveness against both national and regional peers. The company’s decision to revise 293 products covering 497 SKUs and drop MRPs by 7–13% is the sort of systematic reset that can unlock volume elasticity across BoroPlus, Zandu OTC and Smart & Handsome in the months ahead.

The brand work continued at full clip even as channels adjusted. Smart & Handsome—re-imagined last year to move beyond fairness into full-spectrum male grooming—added 12 new SKUs this quarter, from sunscreens and shower gels to face serums and sheet masks. Kesh King returned in a premiumized avatar—Kesh King Gold—with Gro Biotin and Plant Omega 3-6-9, newer packaging and a sharper promise of performance. On the Zanducare D2C platform, the company introduced Good Gut Cleanse & Detox Shots and Acidity & Bloating Relief Tablets, continuing to cultivate digital-first niches. Each of these extensions pushes Emami up the value curve, protecting margin while reducing reliance on any one season.

Outside India, Emami’s international business grew 8%, adding fresh lines under the Creme 21 umbrella (Xtra Bright Elixir, day and night creams, facewash, scrubs and new lotions). This diversification matters: it spreads risk, keeps factories utilized, and offers currency-hedged profit pools. In a quarter when domestic offtake was noisy, this steady international lane provided welcome balance.

Investors looking for cash-return signals will note the board’s interim dividend of ₹4 per share (400%), mirroring the company’s stance last year and underscoring confidence in cash generation even through a transition.

Step back and the medium-term thesis is unchanged. Emami runs high-gross-margin personal care and healthcare franchises with deep brand memory, amplified by celebrity-led salience and a broad GT + MT + e-commerce presence. Commodity costs have normalized, innovation velocity is rising, and the GST reset could be a tailwind rather than a headwind once the channel is fully aligned. The next two quarters will tell us how quickly those building blocks translate into volume recovery and margin sustainment.

Boilerplate for your article (copy-paste friendly)

Why Q2 dipped: GST rate cuts (to 5% on ~93% of core portfolio) caused short-term destocking and deferred winter loading; summer-linked talc/PHP stayed weak on weather. Underlying demand remained healthy where the GST transition didn’t interfere; international business grew 8%. Gross margin steady at 71%. Dividend: ₹4/share.

What to watch in H2: (1) Shelf normalization and volume elasticity after 7–13% MRP reductions; (2) Winter portfolio performance; (3) Contribution of premium relaunches (Kesh King Gold) and male-grooming adjacency (Smart & Handsome); (4) International momentum.

Sources & filings

• Q2 FY26 press release (Nov 10, 2025): Revenue ₹799 cr; GM 71.0%; EBITDA ₹179 cr; PAT ₹148 cr; GST transition details; dividend ₹4/share; October rebound commentary. Emami –

• Q1 FY26 press release (Jul 31, 2025): Revenue ₹904 cr; GM 69.4%; EBITDA ₹214 cr; PAT ₹164 cr; weather impact; innovation launches.

• Q2 FY25 press release (Nov 7, 2024): Revenue ₹891 cr; GM 70.7%; EBITDA ₹250 cr; PAT ₹213 cr; dividend ₹4/share (FY25).