Shares of Hindustan Unilever (HUL) were on track to post their worst annual performance in over two decades, as investors largely stayed away from consumer goods stocks this year amid a challenging sector outlook marked by rising input costs, slowing growth expectations and concerns over consumer demand.
So far in 2026, the stock has lost nearly 20%, falling to ₹1,858 apiece and dragging the company’s market capitalisation below ₹4.5 lakh crore. The stock last witnessed a comparable annual decline in 2004, when it crashed 30%. Since then, it has recorded a double-digit annual loss only once, in 2024.
Reflecting the sustained selling pressure, HUL shares have closed in the red in each of the past five months, with losses widening further in October. The stock briefly touched its lowest level since 2019 earlier this month before witnessing a mild recovery.
The weakness is not limited to HUL. As many as 12 of the 15 constituents in the Nifty FMCG index, including ITC, Godrej Consumer Products, Dabur India, Colgate-Palmolive, Britannia Industries and Nestlé India, have declined by between 20% and 40% in 2026.
Market participants are increasingly concerned that higher commodity prices, particularly crude oil and palm oil, are squeezing margins across the consumer goods sector. Companies are also facing challenges in passing on the full impact of rising input costs to consumers, adding to concerns over profitability and earnings growth.