Brokerages cut price targets for HUL by 2-8%

Several brokerages have cut target price on FMCG giant Hindustan Unilever (HUL) after its weaker-than-expected March quarter result and volume growth. They have cut target prices by 2-8 per cent as the company reported a 3.4 per cent drop in consolidated profit for the March quarter compared to the year-ago levels and also missed consensus estimates. Domestic consumer growth fell 9 per cent with a decline of 7 per cent in underlying volume growth.

Investec said the below-estimate result reflects on-ground realty of FMCG sector during Covid-19. It has cut estimates by 3-4 per cent for FY21-FY22 to build weaker near and medium term recovery. It remains positive on HUL’s portfolio and execution capacity, but said it would wait for a better entry point as valuations are at 48 times FY22 estimates and earnings visibility is low.

Kotak Institutional Equities has downgraded HUL to ‘add’ from ‘buy’ given the recent run-up in the stock price.


Jefferies has cut earnings estimates by 3-5 per cent. However, the brokerage said near-term pressure in the share price is an opportunity to buy.

Phillip Capital views the result as a short-term blip in a structural story. The brokerage has maintained a ‘buy’ on HUL given the ‘TINA’ factor (There Is No Alternative) and further strengthening of competitive positioning.