Hindustan Unilever Ltd. share price target

We marginally revise our FY23E/24E and maintain BUY with a revised TP of Rs. 3,100 (earlier Rs. 2,670) as we raise our target PE to 56x FY24E EPS (earlier 50x FY24E EPS).

We attended HUVR's analyst meet where the management sounded positive on the future growth potential and achieving competitive growth backed by Change in Estimates | Target | Reco 1) category leading position in ~80% of its portfolio 2) market development in...

The management shared details on the augmentation of its analytics and R&D; strengths, which were already far superior v/s peers. As highlighted in our Annual Report note, there have been a host of initiatives in the past year focusing on the burgeoning E-Commerce market, which now contributes 89% to HUVR's sales. The company's portfolio is already wellplaced, with its E-Commerce market share higher than its Modern Trade (MT)...

While our long-term outlook remains positive, we expect margins to remain under pressure in the near-term, unless the company manages further price hikes. The stock is trading at expensive valuations. Given limited upside to current price level, we downgrade our rating to HOLD with a revised TP of Rs. 2,540 based on 54x FY23E adj. EPS. Volume growth aids topline on YoY basis Company's Q1FY22 standalone revenue came in at Rs. 11,915cr (+12.8% YoY, -1.8% QoQ) aided by volume growth on improved consumer demand, despite disruptions...

ended June 2021 has increased 14% to Rs 12194 crore. Operating profit margin has slumped from 25.1% to 24%, leading to 8% rise in operating profit to Rs 2,921.00 crore. Raw material cost as a % of total sales (net of stock adjustments) decreased from 33.79% to 30.51%. Purchase of finished goods cost rose from 15.15% to 18.51%. Employee cost decreased from 5.72% to 5.42%. Other expenses rose from 20.62% to 21.34%. Selling and administration expenses rose from 7.34% to 8.53%. Other income fell 57% to Rs 66 crore. Provision for interest fell 58% to Rs 13 crore. Provision for depreciation rose 1% to Rs 260 crore. Profit...

Consequent PAT was at | 2061 crore (up 9.6% YoY) five years (from ~| 922 in July 2016 to ~| 2388 levels in July 2021). We roll over FY24 numbers given Covid-19 related disruptions have temporarily impacted financials & FY23-FY4 would be a normalised year. We continue to remain positive and retain our BUY rating on the stock...

We maintain a BUY rating on the stock and value it at 50x FY24E EPS to arrive at a revised TP of Rs 2,670/share (from earlier Rs 2,650/share).

Hindustan Unilever (HUVR) 1QFY22 result was in line with our estimates. Resiliency in demand for health, hygiene and nutrition portfolio helped HUL to protect decline in revenue growth (compared to 4QFY21) due to impact of 2nd wave induced lockdowns. Revenue from discretionary and out of home consumption portfolio impacted significantly. Demand from rural outperformed urban during the quarter. Positively HUL has taken 3% price hike in respective product portfolio to mitigate the impact of inflation. Further, premium portfolio is growing at 2x compared to other products; this should be more margin accretive. Management expects integration with GSK to be 100% complete by...

Hindustan Unilever Ltd (HUL) is India's largest FMCG player having ~44 brands spanning 14 distinct categories largely grouped into home care, beauty & personal care, food & refreshments & others.

Gaining market share: HUVR now has 14 brands with over INR10b in annual sales (v/s 12 brands last year). In FY21, it gained market share in 84% of its portfolio and launched more than 150 SKUs. Rapid technology adoption: A significant leap has been observed in technology adoption among small retailers, which are convinced that this is, indeed, the need of the hour. HUVR's eB2B app, Shikhar', has enabled its retailer partners to place contactless orders conveniently, with over 500k retailers ordering through the app. We reckon that while this accounts for ~20% of HUVR's direct...