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Informist, Wednesday, Jun. 17, 2026

 

MUMBAI – Brokerage Nuvama Wealth Management Ltd. expects the June quarter to be strong for Hindustan Unilever Ltd. The fast-moving consumer goods major is expected to report sales growth of 9-10% on year in the quarter with volumes expected to rise 6–7%, Nuvama said in a research report. While the brokerage is enthusiastic about the company's growth prospects, it also flagged the possibility of the expected El Nino climate pattern hitting rural demand from the December quarter onwards.

 

Nuvama has a "buy" recommendation on the Hindustan Unilever stock with a target price of INR 3,090, implying an upside of around 45% from the stock's closing price Wednesday. The stock trades at a forward price-to-earnings ratio of 44 for FY27, the brokerage noted. 

 

Hindustan Unilever has proved its ability to effect price hikes and grow faster than the market, Nuvama noted. This ability, combined with an improved outlook for sales and distribution and for the personal care segment, and strong growth in processed foods and beverages, has boosted Nuvama's positive outlook on the company. Hindustan Unilever has dubbed its entry into the naturals category a "megatrend".

Highlighting some of the standout elements of HUL's annual report, the brokerage noted that the working capital cycle of the company improved to negative 69 days in FY26 from negative 62 days in FY25. Secondly, its EBITDA margin declined nearly 67 basis points on year to 23.6%. The company has guided for an investment of INR 20 billion over two years to expand manufacturing capacity in fast-growing premium categories across the Beauty & Wellbeing segment and Home Care liquids, the brokerage noted.

 

In the direct-to-consumer segment, Minimalist grew in double digits in the year of acquisition, supported by offline expansion and synergies. OZiva has also scaled up nearly four times over the past three years, strengthening HUL's presence in the health and wellness segment, Nuvama said. The brokerage said e-commerce is the channel of the future, citing the company's revenue growth of 25% on year from the channel, even as quick commerce sales doubled in FY26.

 

The brokerage highlighted some risks such as the rupee's depreciation, which pushes up the cost of imported raw materials. High competition, leading to pricing pressure in popular segments, could also hit the company hard, it said.  End

 

Reported by Eshitva Prakash

Edited by Rajeev Pai

 

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