Hindustan Unilever Pays Rs 193 Crore As Part Of Outstanding Tax Demand
The issue stems from allegations that HUL failed to comply with the income tax provisions in its Rs 3,045-crore deal with GlaxoSmithKline.
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File image of HUL products. (Photo source: Sesa Sen/NDTV Profit)
Hindustan Unilever Ltd. made a payment of Rs 192.55 crore as part of a total outstanding tax demand of Rs 962.75 crore on Nov. 28, according to an exchange filing on Monday.
The tax department had directed the company to make 20% payment of the total outstanding demand on or before Nov. 30, the filing stated.
The issue stems from allegations that HUL failed to comply with the income tax provisions, which mandate tax deduction at source for purchasing a trademark registered in India. The company acquired the rights to the health food drink brand Horlicks from GlaxoSmithKline Plc. for over Rs 3,045 crore in 2020.
Earlier in October, the company filed an appeal with the income tax appellate authority in Mumbai against the demand notice issued by the assessment officer.
The share price of HUL closed 0.69% lower at Rs 2479 apiece on the National Stock Exchange, compared to a 0.6% rise in the benchmark Nifty. The stock has fallen 4.73% in the last 12 months and 6.57% on a year-to-date basis.
Out of the 43 analysts tracking the company, 26 have a 'buy' rating on the stock, 14 recommend 'hold' and three maintains a 'sell', rating according to Bloomberg data. The average of 12-month analysts' price targets implies a potential upside of 15.6%.
