Due to low rural demand, HUL’s net flat

In the December quarter of the fiscal year 2023–24 (FY24), Hindustan Unilever Limited (HUL) reported a standalone net profit of Rs 2,519 crore, up merely 0.55% from Rs 2,505 crore in the corresponding period of the previous fiscal year. In addition, the business recorded a sequential decline in profit of 7.28 percent from Rs 2,717 crore in the prior quarter, according to a regulatory filing released by HUL on Friday.

The company’s overall revenue for the third quarter was Rs 15,473 crore, which represents a 0.10 percent increase from Rs 15,456 crore in the same period last year. The FMCG giant saw a 0.55 percent decrease in overall revenue growth on a sequential basis from Rs 15,559 crore in the September quarter.

In spite of a difficult operating environment, HUL has produced another quarter of robust performance with solid operational fundamentals. Rohit Jawa, Chief Executive Officer and Managing Director of HUL said, “Our focus on providing the right consumer value, excellence in execution, increased investments behind brands and capabilities, premiumization, and market development continues to serve us well.”

He highlighted that rural income growth and winter crop yields are “key factors” that would decide the speed of recovery and stated that greater government expenditure, improved crop realization, and a rebound in winter crop sowing will likely assist in the gradual recovery of market demand.

“In this situation, we continue to prioritize building competitive volume growth and increasing investment in our brands and long-term strategic goals. Jawa said, “We are still optimistic about the Indian FMCG sector’s mid-to-long-term potential, and HUL is still in a strong position to seize this chance while overcoming immediate obstacles.

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“EBITDA margin increased by 10 basis points to 23.7% from the December quarter of 2022. A&P investments and gross margin grew by 400 and 270 basis points, respectively. By maintaining the proper price-value ratio and making competitive investments in support of our brands and long-term capabilities, we continue to manage our company dynamically,” said HUL.
The FMCG giant claimed to have disclosed an underlying volume increase (UVG) of 2%. The company said that home care, beauty, and personal care—which make up around 75% of our business—continue to show volume recovery and experienced mid-single-digit UVG.