Nestle India to pass on GST rate cut benefits to consumers, stock ends flat

Shares of Nestle India ended on a flat note on Monday even as the FMCG firm announced it would directly pass on the GST rate reduction benefits to consumers beginning September 22, 2025.

The revised Goods and Services Tax (GST) rates came into force from September 22, 2025, coinciding with the first day of Navaratri. The government’s updated GST regime moves from four brackets—5%, 12%, 18%, and 28%—to a two-tier structure, with most goods and services now taxed at 5% and 18%. Ultra-luxury items face a 40% GST rate, while tobacco and related products continue at 28% plus cess. Goods across categories, including kitchen staples, electronics, healthcare items, and automobiles, are now expected to be more affordable under the new system.

Manish Tiwary, Chairman and Managing Director of Nestle India, stated, "The GST rate reduction is a positive step for consumers in India, as it will stimulate consumption and contribute to the overall growth of the economy. Nestlé has been an integral part of India for over 113 years, and consumers are at the heart of our business. We remain committed to the single purpose of serving consumers in all possible ways."

The company confirmed it has communicated the rate change benefits through national and regional newspapers and has informed wholesalers, distributors, and retailers to ensure complete transparency as the new rates are passed through the supply chain.

Nestle India's move comes as part of a broader market shift prompted by new GST slabs, affecting a wide range of products. The FMCG major’s shares declined in Monday’s trade, reflecting the initial market response to the tax regime changes.

The company’s public statements focus on maintaining transparency and reaffirming commitment to its consumer base as the adjustments take effect. Nestle India has highlighted its ongoing efforts to keep all stakeholders informed of these changes, with the stated aim of ensuring consumers benefit directly from the reduced GST rates.

Nestle India shares ended 0.61% lower at Rs 1187.80 on BSE today. Market cap of the firm stood at Rs 2.29 lakh crore.