Indian consumers are trading up. Passenger vehicle dispatches hit a record 1.27 million units in the April–June 2026 quarter, a 25.9% jump from the same period last year, according to Siam. Two-wheeler sales also surged 20.3% to 56.3 lakh units. Siam attributes this spike to lower GST rates and easier financing, noting that many riders are swapping two-wheelers for four-wheelers as affordability improves. But these figures measure supplies to dealers, not final retail purchases, leaving room for inventory adjustments.
The electronics sector shows a similar, if more volatile, pattern. Smart TV shipments in India grew 10% year-on-year in the Oct–Dec 2025 quarter, driven by a GST cut on sets larger than 32 inches from 28% to 18% in September. Keshav Bansal, director at Intex Technologies, called this a “meaningful affordability window,” noting his company’s consumer durables business grew 80% in FY26. Buyers aren’t just buying more TVs; they’re buying bigger ones. Models 55 inches and above accounted for nearly one-third of shipments in the March quarter.
But the momentum stalled. Uncertainty triggered by Operation Epic Fury, the US and Israel campaign against Iran launched on Feb 28, hit consumer confidence. Counterpoint Research recorded a 9.8% decline in TV shipments in April–June. Rising input costs, including memory chips and stricter energy-efficiency norms for air conditioners, have also eaten into the tax benefits. Anupam Bansal, executive director at Liberty Shoes, acknowledged the short-term pain from input price hikes, though he expects full refund of input tax credit to help offset some costs.
Fast-moving consumer goods (FMCG) companies saw an initial boost. Nestlé India reported its strongest volume growth in five years in the December 2025 quarter, crediting GST benefits. Hindustan Unilever, Marico, and Dabur also saw volume growth pick up. But that early lift is fading. Companies are raising prices to cope with higher costs, and analysts are now watching the current quarter’s sales closely to see if the GST-driven upgrade cycle survives the geopolitical and cost pressures.