Newsletter
Hindustan Unilever reported a resilient Q2, with revenue and profit rising. However, its operating profit margin narrowed.
By the numbers:
- Net profit: up 4% at ₹2,790 cr vs ₹2,685 cr (YoY)
- Revenue: up 14.4% at ₹18,226 cr vs ₹15,919 cr (YoY)
- EBITDA: up 8% at ₹4,089 cr vs ₹3,785 cr (YoY)
- Margin: at 22.43% vs 23.7% (YoY)
The maker of Taaza and Kissan jam reported underlying sales growth of 15%, its highest in 14 quarters.
How its businesses performed:
- Home care: revenue grew 21.4%, beating expectations of 14-17%. The business, which includes Surf Excel and Rin, benefited from growth in liquid products and price increases. Underlying sales rose 22%, with the quantity of products sold growing at a double-digit rate.
- Beauty & Wellbeing: revenue grew 15.7%, above expectations of 10-13%.
- Personal care: revenue grew 8%, within expectations of 5-11%, led by skin-cleansing and premium products.
- Foods & Refreshment, excluding ice cream: Revenue grew 8.5%, at the upper end of expectations of 6-8.5%.
What management said: demand remains resilient, but rising raw-material costs are expected to persist in the short term.
HUL expects to keep ₹22-24 from every ₹100 in sales after day-to-day operating costs, but before taxes, loan interest and certain accounting expenses.
Stock watch: HUL shares are at a 52-week low.
