Hindustan Unilever (HUL), India's leading fast-moving consumer goods (FMCG) company, has reported a strong performance for the first quarter. The company's consolidated results show an impressive 5% Underlying Sales Growth (USG) driven by a 4% Underlying Volume Growth (UVG), surpassing market estimates of 3-4%.

Financial Highlights

HUL's total sales for the quarter reached Rs. 16,323.00 crores, marking a 5% increase compared to the same period last year. The company's consolidated profit after tax (PAT) grew by 6% to Rs. 2,768.00 crores, despite a 5% decline in PAT before exceptional items.

Segment Performance

The company witnessed growth across all its business segments:

Home Care

• Delivered 4% USG with high-single digit UVG
• Maintained competitive pricing

Beauty & Wellbeing

• Achieved 7% USG with low-single digit UVG
• Driven by strong performance in Health and Wellbeing

Personal Care

• Grew 6% with calibrated pricing actions due to commodity inflation

Foods

• Reported 5% USG with mid-single digit UVG
• Led by double-digit growth in Beverages

Strategic Investments and Portfolio Transformation

Rohit Jawa, CEO and Managing Director of HUL, commented on the results: "Encouraged by favourable macro-economic indicators, we strategically stepped up our investments to effectively advance our portfolio transformation agenda in this quarter. As a result, we delivered competitive, broad-based growth with an Underlying Sales Growth of 5%, driven by an Underlying Volume Growth of 4%, at a consolidated level."

Market Outlook

The company expects the gradual recovery in FMCG demand to be sustained. HUL remains confident that its ASPIRE strategy will further strengthen its presence in segments and channels of the future, powered by superior brands and heightened innovation intensity.

Margin and Profitability

The EBITDA margin for the quarter stood at 22.8%, declining by 130 basis points year-on-year. This was in line with the company's guidance, as HUL continued to step up investments in the business.

Key Developments

1. HUL completed the acquisition of 90.5% shareholding in Uprising Science Private Limited (USPL), which operates the 'Minimalist' brand in skin and hair care, for Rs. 2,706.00 crores.
2. The company launched several new products and variants across segments, including:
   • Surf Excel Matic Express
   • Nexxus (a prestige hair care brand)
   • Red Label Instant Spiced Tea Mix

Conclusion

Despite challenges in the operating environment, HUL's strong volume growth and strategic investments in portfolio transformation demonstrate its resilience and adaptability in the dynamic FMCG market. The company's focus on innovation and brand building continues to drive its performance across segments.

Note: All financial figures are based on the consolidated results for the quarter.

Hindustan Unilever Limited (HUL), India's leading fast-moving consumer goods (FMCG) company, has reported strong financial results for the June quarter, beating market expectations and driving its shares up by 4.08%.

Revenue and Profit

HUL reported a 5.13% year-over-year increase in consolidated revenue, reaching ₹16,514.00 crore for the quarter. The company's consolidated net profit rose to ₹2,756.00 crore, up 5.59% from the same period last year, surpassing Bloomberg estimates of ₹2,583.38 crore.

Operational Performance

Despite the overall positive results, HUL faced some challenges in its operational performance. The company's Ebitda (Earnings Before Interest, Taxes, Depreciation, and Amortization) declined by 0.7% to ₹3,718.00 crore. Operating margins contracted by 132 basis points to 22.51% due to pricing and input cost mismatches.

Segment Performance

HUL's performance across its business segments showed varied growth rates:

Overall, the company achieved a volume growth of 4%.

Strategic Developments

HUL has made significant strategic moves to strengthen its market position:

1. The company acquired the skincare brand Minimalist, expanding its presence in the beauty and personal care segment.
2. HUL expects to complete the demerger of its ice cream business by Q4FY26, which could potentially streamline operations and enhance focus on core areas.

Outlook

Despite facing margin pressures, HUL's ability to exceed profit estimates and achieve volume growth across segments indicates resilience in a challenging market environment. The company's strategic acquisitions and business restructuring efforts suggest a proactive approach to maintaining its leadership in the FMCG sector.

Investors and analysts will be closely watching Hindustan Unilever's performance in the coming quarters, particularly how it manages to balance growth with profitability amidst ongoing input cost challenges. The positive market reaction, as evidenced by the 4.08% jump in share price, indicates confidence in HUL's business strategy and future prospects.