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Informist, Thursday, Apr. 24, 2025

 

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--HUL Jan-Mar net profit INR 24.93 bln 
--Analysts saw HUL Jan-Mar net profit INR 24.77 bln 
--HUL Jan-Mar net profit INR 24.93 bln vs INR 24.06 bln year ago 
--HUL to pay INR 24 per share final dividend 
--HUL Jan-Mar revenue INR 152.14 bln vs INR 148.57 bln year ago 
--HUL FY25 net profit INR 106.44 bln vs INR 101.14 bln year ago 
--HUL FY25 revenue INR 614.69 bln vs INR 604.69 bln year ago 
--HUL Jan-Mar advt, promotion spend INR 14.54 bln vs INR 15.86 bln year ago 
--HUL Jan-Mar EBITDA INR 34.66 bln vs INR 34.35 bln year ago 
--HUL Jan-Mar EBITDA margin 23.1%, down 30 bps on year 
--HUL Jan-Mar home care segment sales INR 58.18 bln vs INR 57.15 bln yr ago 
--HUL Jan-Mar beauty, wellbeing ops sales INR 31.13 bln vs INR 29.87 bln 
--HUL Jan-Mar personal care ops sales INR 21.24 bln vs INR 20.63 bln yr ago 
--HUL Jan-Mar food segment sales INR 38.96 bln vs INR 39.11 bln year ago 
--HUL took price cuts in home care segment to pass on commodity-led benefits
--HUL Jan-Mar home care segment underlying volume grew in mid single digit
--HUL had seen near to mid term EBITDA margin at 23-24% in Jan
--HUL: Expect EBITDA margin to be in a range of 22-23% in near to mid term
--HUL: Expect gross margin to moderate in near to mid term
--HUL: Expect Apr-Sept of FY26 to be better than Oct-Mar of FY25
--HUL: Expect price growth in low single digit if commodities remain stable
--HUL FY25 underlying volume grew 2% on year
--HUL Jan-Mar gross margin 49.8%, down 160 bps on year
--HUL Jan-Mar underlying volume grew 2% on year
 

 

By Anand JC

 

NEW DELHI - Hindustan Unilever Ltd.'s revenue growth in the March quarter exceeded 2% year-on-year for the first time since September quarter of 2022-23 (Apr-Mar). While the company's top line and bottom line exceeded consensus estimates for the reporting quarter, its volumes grew in low single digit. While shares of the company initially reacted positively to the results, they soon fell and at 1043 IST, these were trading 1% lower at INR 2,399 on the National Stock Exchange.

 

HUL reported a net profit of INR 24.9 billion, a tad higher than analysts' estimate of INR 24.8 billion. Year-on-year, the company's bottom line grew 3.6%. For FY25, its net profit was INR 106.4 billion, 5.2% higher from a year ago. HUL's revenue for the reporting quarter was INR 152.1 billion, 2.1% higher on year, and comfortably above analysts' estimate of INR 147.2 billion. Its top line for the full FY25 was INR 614.7 billion, up 1.7% from a year ago.

 

Analysts had expected price hikes undertaken by the fast moving consumer goods major during the latest quarter to drive top line growth, but restricted by the lack of improvement in urban demand. The muted growth in top line is evidenced by the 2% underlying volume growth in the March quarter. Most analysts had forecast a 0-2% growth in the March quarter. Volume growth in the December quarter, September quarter, and the June quarter was flat, 3%, and 4%, respectively. In the base quarter, HUL's volume growth was 2%.

 

HUL's earnings before interest, taxes, depreciation, and amortisation for the March quarter were INR 34.7 billion, up around a percent on year. Its EBITDA margin for the March quarter fell 30 basis points while gross margin was 49.8%, down 160 bps. For FY25, the company reported an EBITDA of INR 142.9 billion, largely unchanged on year. HUL's EBITDA margin for FY25 was 23.5%, down 30 bps from a year ago.

 

Going forward, HUL expects its gross margins to moderate as the company tweaks its pricing strategy, and invests in high-growth demand spaces, it said. The company expects EBITDA margin to remain in the range of 22-23%, lower than its January forecast of 23-24?ITDA margin in the near-to-mid-term. 

 

The first half of FY26 would be better than the second half of FY25, HUL said in its investor presentation, as it expects growth to gradually improve due to portfolio changes and improving macroeconomic conditions. Price growth could be in the low-single-digit range going ahead if commodity prices remain unchanged, HUL said. In the near-to-mid-term, HUL plans to continue its focus on volume-led growth. 

 

SEGMENTS

In the March quarter, HUL's home care segment's underlying sales growth was 3% year-on-year, driven by mid-single digit volume growth. The company had cut prices in this segment as related input costs eased. For the March quarter, the segment's revenue grew 1.8% on year to INR 58.2 billion. While volumes of the fabric wash brands grew in mid-single digit, household care volume growth for the March quarter was in high-single digit, the company said in its investor presentation. This segment contributes 38% to the company's overall revenues.

 

The foods segment, which contributes a little over 25% to HUL's top line, reported a revenue of INR 39 billion for the March quarter, down a tad year-on-year. This segment's underlying sales contracted 1% on the back of a mid-single-digit decline in volumes. In the beverages sub-segment, tea business grew in low-single digits while the coffee business grew in double-digits. Category headwinds and transitionary impact of pack-price architecture change dragged the nutrition drinks business. Outperformance in the ketchup, mayonnaise, and international cuisines businesses drove the mid-single digit volume growth in the company's packaged food business. The Kwality Walls-maker's ice-cream business volumes grew in double digits in the March quarter. 

 

The beauty and well-being segment reported a revenue of INR 31.1 billion for the March quarter, up 4.2% on year. Underlying sales growth in this segment was 3% for the reporting quarter, while volume growth was in the low single digit. The hair care sub-segment saw double-digit growth, skin care and colour cosmetics reported a low-single-digit decline. 

 

The personal care segment earned the company a revenue of INR 21.2 billion, up 3% on year. Volumes of this segment contracted in the low single digit for the March quarter even as underlying sales growth was 3%.

 

EXPENSES

HUL's total expenses for the March quarter increased to INR 121.4 billion from 118.1 billion in the base quarter. The company's cost of materials consumed for the March quarter was INR 43.4 billion, largely unchanged from a year ago. HUL's advertising and promotion expenditure for the March quarter was INR 14.5 billion, down 8% on year. The FMCG major's tax expenses for the March quarter fell 12% on year to INR 121.4 billion.  

 

The company's board has recommended a final dividend of INR 24 per share for FY25. In November, the company paid an interim dividend of INR 19 per share, along with a special dividend of INR 10 per share.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Deepshikha Bhardwaj

 

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