HUL, one of the leading FMCG companies in India, said that the current slowdown is not very worrisome as unique challenges are posed every year in the country. “Regardless of what situation is emerging and every year is different in India, it is not unique to this year or last year, every year has its challenges,” Sudhir Sitapati, Executive Director, Hindustan Unilever, told CNBC TV-18 in an interview. However, the company always has got some trick up its sleeves somewhere to compete in the market, he added. Fast-moving consumer goods sales have slowed down in the country and FMCG firms have been reeling under it for close to a year now.
Hindustan Unilever, the Indian arm of British-Dutch FMCG behemoth, was last year slapped with an anti-profiteering penalty of Rs 383 crore as the company was allegedly found to be not passing on lower GST benefits to the customers. Speaking on the same, Sudhir Sitapati said that while taxes on a lot of consumer products were reduced, HUL “was not able to implement the price reductions on the day in which the taxes were reduced because of stocks in the factory, stocks in the warehouse,” he told the news channel. So, the FMCG firm calculated the tax benefit that it could not pass on to the customers and submitted the same to the government. However, the anti-profiteering regulator NAA said that the company owes more.
Recently, another FMCG firm Nestle also came under NAA radar and the watchdog slapped Rs 90 crore fine on the firm. The methods deployed by Maggi noodles-fame company were found to be ‘‘illogical, arbitrary, and illegal, which has resulted in unfairness and inequality while passing on the benefit of tax reduction,” the National Anti-profiteering Authority (NAA) had said earlier. Nestle deposited Rs 16.5 crore in the Consumer Welfare Fund last year. The remaining amount is to be deposited within the next three months, NAA had said early in December.
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Source: Financial Express