Hindustan Unilever Ltd. share price target

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...

Continued strong demand in Rural areas supported by decent urban demand recovery improves the outlook of the business in near-term. Despite uncertainty arising due to increase in COVID cases, we believe the company is well-placed in terms of demand planning & supply chain management. Therefore, we maintain our BUY rating on the stock with a target price of Rs. 2,710 based on 58x FY23E adj. EPS. Strong recovery in BPC, HC drives revenue growth HUVR's revenue grew by 34.6% YoY (+2.3% QoQ) to Rs. 12,132cr, supported by...

(accounting for 30.87% of total sales). Sales of Beauty & Personal Care segment has gone up GSKCH business, which was amalgamated with the company effective April 1, 2020. Sales of Others segment has gone up 112% to Rs 507.00 crore (accounting for 4.08% of total sales). Profit before interest, tax and other unallocable items (PBIT) has jumped 52% to Rs 2,777.00...

Though HUL saw strong growth momentum till the second week of April, second wave of Covid-19 started to impact discretionary categories again after localised lockdowns. We believe soaps, sanitisers & foods categories would continue to see robust growth in FY22E also with heightened hygiene preferences & increase in at-home consumption. Detergent, cosmetics &...

We believe, over the medium to long term HUL is poised to deliver a consistent and profitable volume led growth given execution, distribution and digital capabilities.

Hindustan Unilever (HUVR) 4QFY21 result was above our estimates. Revenue on comparable basis, grew 21%YoY (+16%YoY volume growth) driven by continued doubledigit growth momentum in health, hygiene and nutrition portfolio. Gross margin declined for the fourth consecutive quarter due to raw material cost inflation. Inflation in palm oil price has been alarming (40-50%YoY) however; HUL has taken c. 7-8% price hike to offset the same. As per our channel check, HUL has taken 13-20% hike in select SKUs of key brands; Lifebuoy, Rexona, Liril etc. Positively, HUL has launched Rs2 sachets in Horlicks and Boost brand to drive market development and penetration in HFD category. During current pandemic, HUL is better prepared compared to last crisis. As on...

Hindustan Unilever (HUVR) reported a good set of numbers on all fronts in 4QFY21, led by a recovery in its Discretionary portfolio and Detergents. Two-year average like-to-like sales growth has now improved to 5.8% in 4QFY21 from minor decline in 1QFY21. Ongoing lockdowns would result in a temporary impact on high-margin discretionary product sales, leading to a 4.3% EPS reduction in FY22E; we have retained our FY23E forecasts. We continue to monitor the situation as it unfurls. HUVR is likely to resume the strong earnings growth path from the preCOVID era (~18% CAGR in the four years ended FY20), led by the same...