International companies operating in Bangladesh are reporting rising sales, signaling a recovery in consumer demand, but profitability remains under pressure due to higher costs and limited pricing power.

According to financial reports from 12 multinational companies, including Grameenphone, British American Tobacco, Robi, LafargeHolcim, Berger Paints, Marico, Singer, Heidelberg Cement, RAK Ceramics, Reckitt Benckiser, Unilever Consumer Care Limited, and Linde Bangladesh, combined sales grew by 8 percent in the July-September quarter of this year. By comparison, sales rose just 1 percent in 2024 and 3 percent in 2023.

Despite the sales increase, profitability measured as profit relative to sales—fell from 9.28 percent in Q1 of FY25 to 8.61 percent in Q1 of FY26, largely due to rising raw material costs, energy charges, and finance expenses. Combined profits for the multinationals rose slightly to Tk 1,637 crore, up from Tk 1,633 crore in the same period last year. Linde Bangladesh’s profits were excluded due to an exceptional one-off gain last year.

Experts and company executives point to several factors behind the growth and muted profits. Iqbal Chowdhury, CEO of LafargeHolcim Bangladesh, said the strong sales partly reflect a low base effect from the previous year, while inflation, promotions, and volume growth also contributed. However, companies were unable to fully pass rising costs on to consumers, limiting profit margins.

Shahidul Islam, CEO of VIPB Asset Management Company, said the low profitability and past weak performance stem from “an extremely bad time” for the economy, including political unrest, high inflation, and a dollar shortage that disrupted raw material imports.

Sales growth varied across sectors: RAK Ceramics led with 54 percent growth, followed by Unilever Consumer Care at 25 percent and Marico at 23 percent. Singer grew 15 percent, British American Tobacco 11 percent, and Reckitt Benckiser 10 percent. Other firms, including Linde, Berger, LafargeHolcim, Grameenphone, and Robi, recorded growth between 1 and 7 percent.

Analysts highlighted that a significant portion of the growth—around five percentage points of the 8 percent increase came from price adjustments, while the remainder reflected higher volumes.

Despite the challenges, experts remain optimistic about the outlook for the coming months, citing signs of economic recovery, improving foreign exchange levels, and easing inflation. Once political stability is restored, consumer demand and corporate sales are expected to strengthen further, they said.