Shares of Hindustan Unilever Ltd. (HUL) fell as much as 2.77% to Rs 2,358.00 apiece on Friday. This compares to a 0.84% decline in the country's benchmark NSE Nifty 50.
The fall in the share price comes after the company declared its Q3 earnings on Thursday. The FMCG major reported consolidated net profit of Rs 2,118 crore, down 30% year-on-year from Rs 3,027 crore.
Hindustan Unilever Q3 Results Highlights (Consolidated, YoY)
- Revenue up 5.7% at Rs 16,441 crore versus Rs 15,556 crore (Bloomberg estimate: Rs 16,156 crore)
- Ebitda up 2.7% at Rs 3,788 crore versus Rs 3,689 crore (Estimate: Rs 3,770 crore)
- Margin at 23% versus 23.7%. (Estimate: 23.3%)
- Net profit down 30% at Rs 2,118 crore versus Rs 3,027 crore (Estimate: Rs 2,615 crore)
- Profit from discontinued operations at Rs 4,485 crore.
Separately, HUL said it will invest Rs 824 crore to acquire the remaining 49% stake in Zywie Ventures, which operates the OZiva brand. It also divested its 19.8% holding in Nutritionalab for Rs 307 crore.
Hindustan Unilever Share Price Today
HUL Share Price Today
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The total traded volume during the session stood at 1.44 times the 30-day average. The relative strength index — a momentum indicator — was at 43.47.
Of 43 analysts tracking the stock, 31 have a 'buy' rating, nine have a 'hold' rating while three recommend 'sell', according to Bloomberg data. The average 12-month consensus price target stands at Rs 2,701.19, implying a potential upside of 14.2%.
What Brokerages Say
Jefferies has maintained a 'buy' rating on the FMCG major and hiked its target price to Rs 2,850 from Rs 2,815 noting that all eyes are on execution. The brokerage has maintained a positive outlook on HUL stating their management has struck a confident tone on outlook and stressing on initiatives aimed at speed, agility and customisation under the ‘Unified India' strategy.
Jefferies is also seeing a push toward portfolio transformation, with an intent to take fewer but higher-impact bets. While the brokerage is upbeat about the strategic direction and commentary, it also cautions that the stock is likely to remain range-bound until growth pick-up is visible.
Meanwhile, Goldman Sachs (GS) has also maintained a constructive view, maintaining a 'buy' call but has cut its target price to Rs 2,750 from Rs 2,800.
GS expects home care growth to accelerate, supported by pricing growth likely to turn positive, while also flagging an encouraging recovery in foods. The brokerage notes that the company is making major changes to organisation structure to drive speed and innovation
ALSO READ: Hindustan Unilever Q3 Results: Profit, Volume Growth Miss Estimates; Stock Declines Over 3%
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