Domestic brokerage firm Motilal Oswal has reiterated a ‘Buy' rating on Hindustan Unilever Ltd. with a target price of Rs 2,650, implying an upside of around 21% from current levels, citing improving demand trends and strong execution across segments.
According to the brokerage HUL continues to strengthen the key drivers underpinning its success in India over the last decade, including:
- pioneering the use of technology to generate data and facilitate decision-making;
- the Winning in Many Indias (WiMI) strategy;
- inorganic growth opportunities;
- funneling cost savings back into the business; and
- strong execution capabilities that have led to positive earnings momentum.
The brokerage also noted tha HUL has continued to strengthen its brand, distribution network, and quality of personnel, thereby staying ahead of its peers. In addition, through its analytics and R&D initiatives in recent years (much ahead of its peers), the company is ensuring it remains resilient in a dynamically changing environment.
Motilal Oswal also highlighted that HUL remains focused on topline growth, backed by volume acceleration alongside new launches across categories and channels. The company has unveiled its ‘Unified India' strategy to simplify the organization structure to accelerate decision-making and execution.
Additionally HUL continues to remain focused on driving volume-led revenue growth, even at the expense of near-term margins. Despite concerns around rising crude prices and macro volatility, management believes the company is well positioned to navigate the environment through commodity hedges, accelerated cost-saving initiatives, portfolio transformation strategies, and stronger omnichannel capabilities.
Further, the company announced Rs 2,000 crore of capex toward premium and high-growth categories and remains optimistic about delivering improved performance in FY27 vs FY26.
In its Q4 FY26 concall, HUL maintained consolidated Ebitda margin guidance of 22.5-23.5% (adjusted for the ice-cream business demerger).
Motilal Oswal has reiterated its Buy rating on the stock with a target price of Rs 2,650 (50x on Mar'28E EPS).
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
