GST Gains Uneven Across Retail: Premium Brands Thrive, Mass Players Lag

Despite expectations of a consumption boost, GST rate cuts failed to revive festive-season demand for India’s apparel and footwear retailers. While premium brands saw steady traction, mass-market players struggled with weak discretionary spending, delayed purchases, and transitional disruptions. Retailers like

reported deferred buying due to the long transition window between GST announcement and rollout. Channel partners postponed purchases to avoid input tax credit mismatches. Bata’s revenue fell 4.2% YoY in Q2FY26, and net profit dropped sharply, despite early price cuts and incentive schemes. The GST rate on footwear priced up to ₹2,500 was cut from 12% to 5%, and apparel slabs were simplified. However, demand remained weak in low-ticket categories. Analysts noted that brands like Metro and Pantaloons benefited due to stronger mid-premium positioning, while Bata and Khadim faced deeper relevance issues beyond tax changes. ’s Q2 sales declined YoY, with premium lines growing but mid-segment continuing to struggle. also saw muted response in lower-ticket categories. cited unseasonal rains and cautious sentiment as growth dampeners. Overall, GST benefits did not translate into immediate volume gains for most mass-market players. reported immediate demand acceleration once new rates took effect, with up to 11% price reductions in key segments. , operating brands like Van Heusen and Louis Philippe, saw stable demand and minimal disruption, aided by early festive triggers like Pujo and resilient premium consumer behavior. While GST cuts improved affordability, their impact was uneven. Consumer sentiment, brand relevance, and product-market fit played a larger role in driving demand. Retailers now look to H2FY26 for a more sustained recovery, especially if macro conditions stabilize and discretionary spending picks up.