4 Stocks that Thrive When Inflation Rises

#2 Bharti Airtel Ltd

Bharti Airtel is a global communications solutions provider serving over 590 m customers across 15 countries in India and Africa.

The company operates a diversified portfolio including Mobile Services, Homes Services, Digital TV, and Airtel Business.

Revenue is primarily generated through recurring subscription fees for voice and data, inter-segment infrastructure rentals, and mobile money services.

Its core strategy focuses on "portfolio premiumization" migrating customers from 2G to 4G/5G and from prepaid to high-margin postpaid plans.

Airtel possesses strategic pricing power, evidenced by its leadership in "tariff repair" to improve industry financial health and drive Average Revenue Per User (ARPU) towards a Rs 300 target.

While rising energy and tower rental costs pressure margins, Airtel acts as a qualified beneficiary by leveraging its "War on Waste" (WoW) program to strip out operational inefficiencies.

In FY25, Airtel neutralized inflationary headwinds by saving over Rs 22 bn in network opex through AI-powered energy optimisation and structural changes to DTH subsidies.

Financial Performance

Airtel Financial Snapshot

Sales have grown at a consistent double-digit pace, because of strong customer additions and a 17% increase in ARPU due to premiumization.

Operating profit margins have improved as the company benefited from operating leverage and reduced costs under its "War on Waste" initiative.

Net profit saw volatility in FY24 due to currency devaluation in African markets, while the rise in FY25 was largely supported by the consolidation of Indus Towers.

#3 Colgate-Palmolive (India) Ltd

Colgate-Palmolive (India) Ltd is the leader in the Indian oral care market, manufacturing and trading toothpaste, toothbrushes, mouthwash, and personal care products.

The company makes money by leveraging its 95% weighted distribution reach across 7 m stores to sell trusted brands like Colgate and Palmolive. It has a 2.8 times greater market share over its nearest competitor.

Revenue is generated through two primary segments: Oral Care and Personal Care. Its strategy focuses on science-led premiumization moving consumers to high-margin products like Colgate Total and Visible White while driving consumption frequency through initiatives like the "Brush at Night" campaign.

This allows the company to use strategic pricing ladders and revenue growth management to move consumers from base SKUs to premium variants that offer higher realisations.

During inflationary periods, the company is a beneficiary because its funding the growth program generates efficiencies (worth 5.8% of topline) that offset rising commodity costs.

Financial Performance

Colgate-Palmolive (India) Financial Snapshot

Revenue growth is accelerating, growing at 1.7x the FMCG index, because of a 13% increase in average selling prices due to a more premium product mix.

Operating margins have also improved as cost-efficiency initiatives helped fund higher advertising spending of Rs 8,220 m in FY25.

Net profit is strong because of an almost debt-free balance sheet and a high return on capital employed (ROCE) of 121%. It highlights the company's high efficiency and profitability.

#4 Marico Ltd

Marico Limited is a global consumer goods major operating in the beauty and wellness sectors across 25+ countries.

The company generates revenue through three primary segments: Domestic Core (Parachute coconut oil, Saffola edible oils), Domestic Diversification (Healthy Foods, Value-Added Hair Oils), and International Business (Bangladesh, Vietnam, MENA, South Africa).

It makes revenue by leveraging a high distribution scale and legacy brand equity to drive high-volume sales while incubating higher-margin digital-first franchises like Beardo and Plix.

Marico possesses formidable pricing power, particularly in its core coconut oil franchise where it holds a 63% market share.

The company successfully passes on cost pressures to consumers. Notably, it implemented a 60% pricing growth in Parachute to mitigate hyperinflation in copra prices.

Financial Performance

Marico Financial Snapshot

Sales grew 12% in FY25 because of double-digit growth in the domestic market along with expansion in the foods segment and digital-first brands.

Operating margins declined to 18% in H1 FY26 due to inflation in copra prices, which rose 113% year-to-date, although cost-saving initiatives under the "MarVal" program helped limit the impact.

Net profit remains stable and healthy, supported by over 20% constant currency growth in international markets and a better mix of high-margin premium personal care products.

Conclusion

Across these four companies, one clear pattern emerges of pricing power being the most important thing during inflation.

Businesses that can raise prices, control costs, and maintain demand will continue to grow its profits despite the challenges faced.

However, investors should remember that in the long run, only companies that can offset negative pressures and adapt to changing consumer demand will truly sustain growth and survive.

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