Hindustan Unilever Limited delivered its highest quarterly growth in 12 quarters for the period ended 31st March 2026, reporting 8% consolidated revenue growth driven by a robust Underlying Volume Growth of 6%. The performance was broad-based across all segments, with EBITDA margin coming in at 23.7%—at the higher end of company guidance. Profit After Tax before exceptional items stood at ₹2,711 crores, growing 4% year-on-year, while Reported Profit After Tax grew 20% year-on-year, reflecting proceeds from the divestment of Nutritionalab Private Limited and OZiva fair valuation in the base period.

Q4 FY26 Financial Highlights

The company's quarterly performance reflected consistent execution across portfolio, channels, and investments. The following table summarises key financial metrics for the quarter:

Full Year FY26 Performance

For the full financial year ended 31st March 2026, Hindustan Unilever reported a consolidated turnover of ₹63,763 crores, with 5% Underlying Sales Growth driven by 4% Underlying Volume Growth. EBITDA margin for the full year stood at 23.6%, at the higher end of guidance, with overall EBITDA growing 2%. Advertising and promotion spends were stepped up with ₹270 crores increase in absolute spends for the full year. PAT before exceptional items for the full year was ₹10,324 crores.

Segment-Wise Performance

All four segments delivered healthy growth for both the quarter and the full year. The table below captures segment-level Underlying Sales Growth:

Home Care recorded its strongest performance in 11 quarters, with Fabric Wash delivering double-digit growth across formats and the liquids portfolio crossing the ₹4,000 crores turnover mark. Beauty & Wellbeing saw Hair Care post strong double-digit volume-led growth, with shampoo bottle distribution in General Trade increasing 25% during the quarter. The Masstige and Wellbeing portfolio reached an annual revenue run rate of ₹1,200 crores. Minimalist delivered strong double-digit growth with an annual revenue run rate of approximately ₹850 crores, while Simple scaled to an annual revenue run rate of more than ₹160 crores. The premium skin beauty portfolio across Minimalist, Simple, OZiva, and Nexus operated at an annual revenue run rate of close to ₹1,400 crores.

Personal Care saw premium Skin Cleansing post its highest growth in 12 quarters, with Bodywash gaining approximately 400 basis points of market share. Vaseline surpassed the ₹1,000 crore milestone for the year. Foods benefited from Lifestyle Nutrition delivering double-digit growth in the quarter driven by Horlicks and Boost, with Coffee continuing strong double-digit growth momentum.

Balance Sheet and Capital Allocation

The company's financial position remained robust. Total reserves for HUL as at the end of FY26 stood close to ₹49,000 crores, while cash flow from operations stood close to ₹10,500 crores. Both ROCE and ROE improved on a year-on-year basis.

During the year, the company deployed ₹3,500 crores into bolt-on acquisitions, including digital-first premium Beauty & Wellbeing platforms such as Minimalist and OZiva. In addition, a ₹2,000 crores planned capex investment was signed off to expand capacity in premium formats across liquids in Home Care, Personal Care, and Beauty. Direct coverage in General Trade was expanded by approximately 2 lakh outlets during the year, and e-commerce delivered over 25% growth for the financial year.

Commodity Outlook and Margin Guidance

Management noted that the escalation of the Middle East crisis in March led to a sharp spike in crude and crude-linked commodity costs, supply-side disruptions, and continued rupee depreciation. The company indicated a material cost inflation of approximately 8% to 10% on its material cost base, against which calibrated price increases of 2% to 5% have already been implemented across select portfolios, with further increases to be taken as necessary. The mid-term EBITDA margin guidance was maintained at a band of 22.5% to 23.5%. Management stated that FY27 is expected to be better than FY26, with competitive volume-led growth remaining the company's stated number one priority.

Hindustan Unilever has received a revised target price of ₹2,480 from Morgan Stanley, which has maintained its Equal-weight rating on the stock. The upgrade in target price reflects a more constructive view on the company's near-to-medium term prospects, driven by a combination of demand recovery signals, pricing actions, and margin stability.

Improving Demand Outlook Supports Revised Estimates

Morgan Stanley's revised stance is anchored in an improving demand environment, with stable trends observed across both rural and urban consumption segments. The brokerage expects this demand momentum to translate into meaningful growth acceleration, projecting approximately 11% growth for FY27. These factors have collectively contributed to earnings upgrades for Hindustan Unilever.

Pricing Actions to Counter Cost Pressures

To manage rising input costs, Hindustan Unilever is expected to implement price hikes in the range of 2–5%. These increases are intended to offset cost inflation estimated at 8–10%, helping the company protect its profitability amid a challenging raw material environment. The following table summarises the key parameters highlighted by Morgan Stanley:

Margin Stability Underpins Earnings Upgrades

Morgan Stanley has also highlighted steady EBITDA margin guidance in the range of approximately 22.5–23.5% as a key factor supporting its revised outlook. This margin stability, combined with anticipated volume recovery and pricing power, forms the basis for the earnings upgrades reflected in the raised target price. The brokerage's Equal-weight rating indicates a neutral stance, acknowledging the positive developments while maintaining a balanced view on the stock's risk-reward profile.