Festive shopping spree just got bigger: How GST cuts supercharged Navaratri sales across India
Indian consumers opened their wallets during the Navaratri festival, boosting sales of air conditioners and apparel following recent GST cuts. Demand also surged for chocolates and home appliances, signaling steady consumer sentiment despite global economic headwinds.
Mumbai: The reduction in goods and services tax was expected to boost consumption—and it did. After a sluggish start to September, shoppers who had delayed purchases until the new GST rates took effect on 22 September, flocked to stores and online platforms to buy air conditioners, festive wear, and gifts, making this Navaratri one of the best in recent years, according to retailers.
Large appliances saw a slowdown in demand ahead of the new rates. However, after 22 September, makers of home appliances such as air conditioners and televisions, along with apparel retailers, reported an uptick in sales, buoyed by lower taxes and extra incentives offered by retailers.
During Navaratri 2025 (22 September–2 October), the FMCG sector grew strongly with a 34% rise in value and 43% increase in volume over last year's Navaratri (3 October-12 October). Packaged foods and commodities led the gains, both rising 35% and 30% respectively in value terms and 48% and 45% in volume terms, according to data shared by retail intelligence platform Bizom.
Dairy products rose 43% in value and 36% in volume terms. Home care rebounded with a 28% value and 22% volume growth, while personal care surged 65% and 74% in value and volume terms respectively, after last year’s dip.
However, beverages and chocolates slowed sharply, with value growth at 20% and 2%, and volume growth at 2% and 10%, respectively. Essentials and daily-use goods drove festive demand, while indulgent segments cooled from last year’s highs, largely due to GST rate cuts, Bizom said.
Home appliances such as televisions, washing machines, and air conditioners reported higher volume growth of 15–18%, helped by the indirect tax cuts. In contrast, the period between early September and 20 September saw declines in appliance sales—kitchen appliances such as utensils, water purifiers, and microwave ovens fell 20%, while home electronics declined 25%, according to Bizom, which tracks sales across 8 million outlets in India. Sales of fast-moving consumer goods were flat during the period.
In the April-June period, sales of air conditioners fell 18% year-on-year as unseasonal rains kept the summer temperatures in check, while washing machine sales were flat, per data from industry executives.
Last month, the government rationalized the GST regime into a mainly two-rate structure—5% and 18%—by abolishing the 12% and 28% rates, in a consumption stimulus estimated at ₹2 trillion.
Consumer sentiment
This year’s festive season is slightly shorter, with Diwali and Durga Puja both falling in October. The season also coincided with GST cuts on both big-ticket items and everyday goods.
Market researcher Ipsos said consumer sentiment in India remained stable in September compared to August, despite global concerns such as tariffs and slowing growth. “Consumer sentiment in India has stabilized in September, following the anxiety and sharp decline witnessed in August…domestic developments have played a key role in restoring confidence," said Suresh Ramalingam, chief executive officer (CEO), Ipsos India.
In a fresh survey released Monday, Ipsos said more consumers are expected to put GST savings into festive shopping and big-ticket purchases, boosting demand across retail channels.
A survey among urban consumers found nine in ten excited about festive shopping, with 60% highly or moderately excited and 30% slightly so, signalling strong demand ahead of Karwa Chauth, Dhanteras, Diwali, and Bhai Dooj festivals. Omni-channel retail continues to grow, but in-store shopping remains dominant, with over half of consumers preferring physical outlets. About a quarter use a mix of offline and online, while online-only shopping appeals to a small yet significant base, it said.
Urban demand
The uptick in sales follows rising complaints from companies about weak urban consumption, with middle-class households cutting back on large packs of food, home care, and personal goods, or shifting to cheaper brands.
Ramalingam said the recent GST cuts could ease some of the cost-of-living pressure at a time when food inflation too has been low, he added.
Home appliances maker LG Electronics India had a record start to the Navaratri season after passing on the benefits of lower GST on air conditioners and TVs.
Big-ticket appliances such as air-conditioners, washing machines, televisions above 32 inches, and dishwashers saw GST cut from 28% to 18%, prompting retailers to expect deferred purchases until the revised rates kicked in on September 22.
“This is a direct enabler for our business—it has improved affordability…this entire Navaratri, we have broken all previous records. Cuts have helped move consumers to premium products as they can upgrade within the same budget," said Sanjay Chitkara, chief sales officer, LG Electronics India, in an interview with Mint last week. The company declined to share exact growth numbers.
The GST Council also revised tax rates on apparel and footwear. Items up to ₹2,500 now attract 5% GST, versus ₹1,000 earlier, making mid-market products more affordable. Premium products above ₹2,500 attract 18% GST, up from 12%.
Apparel retailer Lifestyle also reported an uptick in sales and footfall. While average order value fell in line with GST cuts, shoppers returned after weeks of cautious spending. The retailer reported a 6–7% rise in footfalls during Navaratri and higher volumes due to lower GST.
“Festive clothing is essential, so we saw shoppers return. While early September was muted, post-22nd we saw clear pent-up demand. We cut prices in line with GST reductions of 7% on clothing priced between ₹1,000 and ₹2,500, and kept prices above ₹2,500 unchanged to avoid hurting demand," said Devarajan Iyer, CEO and executive director, Lifestyle India, said in an interview with Mint.
Iyer said that a combination of factors are aiding demand. "Consumers are definitely saving money on large purchases. This has created buoyancy in the market. We are seeing increased footfalls in malls and high streets."
Out and about
With a shorter festive cycle this year, many consumers are looking to complete shopping before Diwali, which falls on 21 October.
In Mumbai, media professional Shalini Raina stepped out to the malls last weekend to shop for Diwali gifts and hampers. While the budget was limited to ₹20,000, Raina said she was able to avail more discounts on home products and crockery. “I actually ended up buying one or two additional items like glass sets for gifting," she told Mint at Mumbai's Infinity Mall.
For biscuits, Parle Products reported flat sales in the 20 days before the new GST. However, sales jumped after the GST cuts took effect.
“We are seeing 15–20% growth compared to average weekly sales. We expect this to continue as we move into Diwali. Transition to revised rates is still a work-in-progress. Volume growth was flattish in the period post the GST announcement and before the GST rollout, but going forward we expect better growth," Mayank Shah, vice-president of Parle Products, said in an interview with Mint.
Saif Khan, managing director & CEO, BSH Home Appliances that sells washing machines and dishwashers, said the festive season demand has been “strong" with a clear shift toward premiumisation.
“The GST rate cut on dishwashers from 28% to 18% has unlocked new demand, with e-commerce sales in this category more than doubling year-on-year within just the first week of Navaratri. Front-load washing machines have similarly delivered a strong growth, further validating the upward trend in consumers choosing efficiency and sustainability in their homes," he said, speaking of the post-22 September demand.
New launches at the home appliances maker were backed by festive offers and flexible financing options. "We remain optimistic about the festive quarter," he said.
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