Biscuits, soaps cooking oil prices may again increase:Ingredient prices rise by up to 74%; mobile recharge plans can also get costlier

Everyday household items such as soaps, edible oils, toothpaste, and chocolates are likely to become more expensive in the coming days. Surging crude oil prices and ongoing supply chain disruptions have driven up raw material costs by up to 74% for fast-moving consumer goods (FMCG) companies, severely hitting profit margins. In addition, a weak monsoon has weighed heavily on overall business performance. According to analysts at CRISIL, Elara Capital, and Kotak Neo, elevated crude oil prices (currently hovering around $113 per barrel) initially pushed up input costs. Now, rising food inflation—which reached 7.74% in September—presents a new challenge. With continuous margin erosion, companies are being forced to offset costs through price hikes. FMCG players expect demand to pick up ahead of the festive season. However, companies have already increased prices by 3% to 5% since the onset of the West Asia crisis. Mobile Tariffs May Increase by 15% in December Telecom bills are also set to rise alongside household expenses. A fresh report by Ambit Capital estimates that telecom operators could raise tariffs by 15% as early as December this year. Following this, mobile services are projected to become 12% costlier every two years over the next decade. However, telecom operators have not yet made any formal announcements. Key Drivers Behind the Telecom Hike: Vodafone Idea: Needs to boost its Average Revenue Per User (ARPU) from ₹177 to over ₹300 by FY30. Bharti Airtel Reliance Jio: Require tariff hikes to rationalize capital investments and secure reasonable returns on infrastructure spends. Silver Lining: Steady Demand Could Drive Double-Digit Revenue Growth Brokerage firm Kotak Neo projects that most FMCG companies could post double-digit revenue growth (above 10%). This top-line growth will be supported by product price hikes, steady demand, and a low base effect from last year (which was impacted by GST adjustments). However, operating margins are still expected to drop by 1% to 1.5%. Festive Season: Limited Room to Pass On Costs Aditya Jhawar, Director at CRISIL Ratings, noted that with the festive season underway, companies will be cautious about further price increases. While urban consumption remains relatively resilient, persistent inflation and a weak monsoon have started dampening rural demand. As a result, FMCG companies will be unable to pass on the full burden of higher input costs to consumers. CRISIL estimates operating margins could contract by 1–1.5% in FY26–27. Relief from Old Inventory to End Soon Amit Purohit, Vice President at Elara Capital, believes companies will hike prices further, though the full impact will reflect with a time lag. According to Amit Agarwal, SVP at Kotak Neo, most FMCG firms will see year-on-year declines in gross margins. Companies are currently relying on older, lower-cost inventory of crude and palm oil. Once these stockpiles run out, the impact of higher raw material prices will become more pronounced. With rising costs in sugar, tea, and edible oils further stressing balance sheets, companies are likely to cut promotional spending to protect operating margins.