HUL drops as investors turn cautious ahead of Q4 results

NEW DELHI: Shares of Hindustan Unilever (HUL) fell 1 per cent in Friday’s trade ahead of the FMCG firm’s fourth quarter results. Analysts are mostly penciling in a 14-18 per cent growth in March quarter profit, led by 7-9 per cent growth in revenues.

They see volume growth in 6-8 per cent range against December quarter’s volume growth of 10 per cent.

Ahead of its numbers, the scrip fell 1.06 per cent to hit a low of Rs 1,709.65 on BSE.


Analysts believe that the FMCG major could report a 70-80 basis points margin expansion, but said ad spends and management commentary on competition would be watched keenly.

Reliance Securities projects 73 bps expansion in margins at 23.5 per cent from 22.7 per cent in the year-ago quarter. This would mean a 156 bps growth over December quarter’s 21.9 per cent.

During the quarter, the maker of detergents and soaps raised prices by 1-2 per cent for a few products.

Edelweiss Securities projects growth in revenue, Ebitda and profit at 7 per cent, 13 per cent and 18 per cent, respectively.

“We expect HUL to record a 6 per cent YoY volume growth on a high base of 11 per cent growth. A delayed summer and elongated winters have also resulted in limited offtake of personal wash products. The rural segment, though, continues to grow faster than the urban market, but the differential in growth rate has come off. Blended price hike of 1 per cent has been taken. We estimate 80 bps YoY Ebitda margin expansion,” Edelweiss Securities said in a note.