Hindustan Unilever Ltd (HUL) is focusing on six major segments in the beauty category to drive growth - Facial cleansers, Weatherproof Bodycare, Serums, Face Cleansing and the Massitge segment.
HUL reported a 10 percent decrease in underlying sales growth for its personal care business, mainly due to a decline in its skin cleaning portfolio, including brands such as Lux.
The overall beauty and personal care business experienced a two percent decline in underlying sales growth, with volume remaining flat. This segment contributed 35 percent of HUL's total revenue for the March quarter, amounting to Rs 5,050 crore.
Despite the decline in the personal care segment, the beauty segment witnessed a four percent growth, according to HUL.
The company has separated the beauty and personal care businesses and is aiming for the beauty segment to drive both profit and growth.
Masstige is HUL’s premium segment comprising of brands like ‘LOVE beauty AND planet’ which is above Rs 100-200 mark. The company is witnessing a fair amount of growth in ecommerce.
“Suncare product is already more than 250 crore business for us. It is still just the beginning,” HUL's CEO Rohit Jawa said in a press conference on April 24.
The management said that while its beauty product line primarily targets urban consumers, it would be inaccurate to suggest that rural markets are neglected.
“It would be wrong to say that it doesn’t cater to some consumers in rural areas like suncare as we have a glow and lovely for suncare as well. The total addressable market will be small for rural,” said Jawa.
The company said premiumization is more pronounced in urban markets, which are typically more resilient, especially among middle-income and higher-income households.
FMCG inflation has been high overall, rural consumers have had to adjust their consumption patterns, particularly for discretionary items, the company said. However, with better monsoons and improvements in the agricultural economy, it anticipates growth in rural markets. Products like Surf Excel and Ezee have been significant contributors to its growth, particularly in rural areas, the company noted.
“Of course there is growth but the scale of growth would be better when the macros are better for rural. But the urban is more resilient and the premium end more robust.” said Jawa.
Hindustan Unilever Ltd on April 24 reported six percent fall in standalone net profit at Rs 2,406 crore for the fiscal fourth quarter as against Rs 2,552 crore in the year-ago period.
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