HUL Share Price Falls After Target Price Cuts Post Q3 Results

Hindustan Unilever Ltd.'s stock fell after its third quarter earnings raised concerns and brokerages cut target prices.

The FMCG major's target prices were cut by multiple brokerage firms due to subdued demand, raising concerns about its near-term performance. This comes on top of challenges for the consumer giant, whose recent profit was inflated by one-time gains. While macros likely remain challenging, the consumer firm's strategic initiatives across categories could drive growth over the medium-term, according to Citi. The brokerage cut fiscal 2025-27 earnings estimates by 2-6% as it lowered revenue growth assumptions.

There is a slowdown in FMCG volume growth for the last six months, said the FMCG major, whose topline grew led by 4-5% gain in pricing, while bottom line was cushioned by the realisation of sale of water purifier business in the quarter. This has led to significant shift in consumer preferences towards smaller packs across categories. This shift seems 'transitory' in nature, the company said, but consumer preference takes a lot of time to return to normal as per past trends.

HUL stock fell as much as 1.19% during the day to Rs 2,315 apiece on the NSE. It was trading 3.22% lower at Rs 2,267.55 apiece, compared to a 0.16% decline in the benchmark Nifty 50 as of 9:25 a.m.

It had fallen 4.58% in the last 12 months. The relative strength index was at 31.18.

Twenty eight of the 43 analysts tracking the company have a 'buy' rating on the stock, 12 recommend a 'hold' and three suggest a 'sell', according to Bloomberg data. The average 12-month analysts' consensus target price on the stock is Rs 2,681.6, implying an upside of 14.5%.