Hindustan Unilever Ltd.'s second quarter financial fine print for fiscal 2027 has brokerages bullish even in an environment where FMCG companies find themselves battling high commodity costs, inflation, and el nino's cascading impact.
HSBC has hiked HUL's price target to Rs 2,220 from Rs 2,210 noting improvement in demand trends despite the aforementioned headwinds. The sales growth was healthy at 15% along with the volume growth at 7%, HSBC underlined while maintaining a 'buy' rating.
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Morgan Stanley also highlighted resilient demand driven by home care and beauty & wellbeing segments, and retained an 'equal-weight' call on the counter even as margins contracted by 142 basis points to 22.6%.
Finally, UBS too has maintained a 'buy' call on the FMCG major with a price target of Rs 2,700 after underlining revenue rise of nearly 15% in the September quarter, and higher-than-expected volume growth.
The brokerage said it saw an overall "strong performance" with home care growth at 22%, beauty and wellbeing sales at 16%, earnings before interest, taxes, depreciation, and amortisation at 8% and net profit at 8.7%.
HUL Q2 FY27 Highlights
Hindustan Unilever Ltd.'s underlying volume growth rose to 7% in the September quarter, its highest since the first quarter of FY22, as the consumer goods maker reported broad-based growth across home care, beauty and wellbeing, and personal care.
The company attributed the growth to calibrated pricing actions, market-development initiatives, product innovation and stronger distribution as key elements of its strategy, even as elevated commodity prices continued to weigh on the operating environment.
Underlying sales growth reached 15%, the highest in 14 quarters, according to the company. Chief Executive Officer and Managing Director Priya Nair said the performance reflected the company's focus on building brands and strengthening distribution.
The year-ago period included a one-off gain of Rs 273 crore from the resolution of prior years' tax matters. In the September 2026 quarter, exceptional items included a Rs 2 crore gain from the disposal of surplus assets.
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