Unilever Eyes Volume Growth in India as Local Rivals Face Supply Chain Squeeze

Supply chain disruptions and surging packaging costs tied to elevated crude oil prices are squeezing local competitors in key emerging markets like India, and Unilever sees this as a window of opportunity to deepen its foothold and accelerate volume growth.

During the company's latest earnings call, Chief Executive Officer Fernando Fernández highlighted that smaller, local players — particularly across India and Southeast Asia — are facing mounting operational constraints. These pressures, he noted, are creating conditions that could support Unilever's volume expansion and make future pricing actions more feasible to implement. Fernández underscored that the company continues to identify and capitalize on opportunities emerging from global supply limitations, even as its own multipolar supply chain remains robust and adaptable.

The results from India tell a compelling story. In the first quarter of 2026, Unilever achieved its highest-ever market share in laundry powders within the Indian market. The company is also making deliberate inroads into the fast-growing liquid detergent segment, signaling an intent to capture shifting consumer preferences as households increasingly move toward premium and convenient product formats.

Chief Financial Officer Srinivas Phatak painted a confident picture of Hindustan Unilever Ltd's performance, describing it as being of a very high order. HUL registered 6 per cent volume growth during the March quarter, a figure that reflects both strong consumer demand and the company's strategic execution on the ground.

Phatak acknowledged that inflationary pressures have not disappeared. Imported crude oil and currency fluctuations continue to weigh on input costs. However, he pointed out that certain categories, particularly home care, tend to benefit when inflation rises — a somewhat counterintuitive dynamic that works in Unilever's favour in this environment. He also highlighted that HUL's diverse and wide-ranging product portfolio enables the company to serve consumers across multiple price points, giving it a structural advantage over local rivals who are simultaneously grappling with supply bottlenecks and constrained cash flows.

Describing the current situation as a unique opportunity, Phatak expressed strong confidence that India will continue to be a key engine of growth for Unilever.

He pointed to the company's demonstrated ability to balance pricing discipline with volume expansion as a central pillar of its India strategy. The overall demand outlook for the country, he stated, remains healthy and gives the company reason to be optimistic about sustaining its growth trajectory in the quarters ahead.

India holds a distinctive and strategically vital position within Unilever's global footprint. It ranks as the company's second-largest market by revenue globally, trailing only the United States, and contributes approximately 12 to 14 per cent of Unilever's total global sales — a share that underscores just how central the subcontinent is to the multinational's long-term growth narrative.

On the regulatory and market dynamics front, Phatak noted that pricing actions, alongside GST-related factors, have begun to generate meaningful growth momentum within India. He also highlighted the strong performance of new-age, digitally native brands such as Minimalist, which are capturing younger, increasingly discerning consumers and bolstering Unilever's confidence in the premiumization segment.

HUL is also investing aggressively in the digital and omni-channel retail space, recognising that the future of consumer goods distribution in India is being reshaped at speed. The company has reported a two-fold increase in quick commerce sales during FY26, a remarkable growth rate that reflects the explosive expansion of rapid delivery platforms across Indian cities. In parallel, e-commerce turnover grew by 25 per cent over the same period. To align its internal structure with this rapidly evolving channel landscape, Phatak confirmed that HUL has put in place a new organizational framework specifically designed to strengthen and scale these digital commerce capabilities — and early signals suggest it is already functioning effectively.

In traditional trade, HUL has not taken its foot off the gas either. The company expanded its general trade outlet coverage by approximately 200,000 outlets, pushing its total distribution reach to around 2.3 million outlets across the country. This expanded physical footprint ensures the company remains accessible to consumers in smaller towns and rural markets where e-commerce penetration is still maturing.

At the global level, Unilever reported a turnover of 12.6 billion euros in the first quarter of 2026, supported by overall volume growth of 2.9 per cent — a steady performance that reflects the resilience of its diversified global business even as macro uncertainties persist.