HUL Q3 profit jumps 18% to Rs 1252 cr, volume growth at 3%

The average of the estimates of analysts polled by CNBC-TV18 had projected a net profit of Rs 1091 crore and revenues of Rs 7963 crore.

The FMCG major also disappointed on volume growth front, which stood at 3 percent, much lower compared to forecast of 5-6 percent and 4 percent in Q3FY14.

There was an exceptional gain of Rs 396 crore on sale of properties in the quarter as against Rs 23 crore in the year-ago quarter. "Net credit in Q3 include profit on sale of surplus properties Rs 407.29 crore and restructuring expenses Rs 10.71 crore," the company said in its release.

Other income fell to Rs 120.07 crore from Rs 142.66 crore during the same period.

Operating profit rose 8.5 percent sequentially to Rs 1,332 crore and margin inched up 10 basis points to 17.1 percent in the quarter gone by.

Soaps (which constitutes 50 percent of revenues) earnings before interest & tax (EBIT) grew 11.4 percent year-on-year to Rs 502.4 crore with margin expansion of 69 basis points in the quarter ended December 2014. The growth was led by products like Lifebuoy, Lux, Surf, Vim etc.

During the same period, personal care EBIT rose 3.3 percent to Rs 680.91 crore with margin falling 90 basis points to 27.7 percent. "In skin care, Fair & Lovely, Pond's and Lakme delivered double digit growth. Even Hair Care also delivered another quarter of volume led double digit growth driven by Dove," said the company release.

However, oral care had a subdued quarter as growth was impacted by the phase out of excise duty benefits and by a strong comparator in the base quarter, it added.

Beverages EBIT increased 2.7 percent to Rs 141 crore with margin declining 77 basis points whereas packaged foods posted EBIT loss of Rs 21.26 crore in third quarter of FY15 compared to loss of Rs 13.40 crore in the year-ago period.

Beverages include tea & coffee businesses while packaged foods products are Knorr, Kissan and ice creams.

The management is seeing a pick-up in rural growth but they can't say if pick-up in rural growth will sustain. According to them, cost of goods sold has come down in Q3. "Input costs were benign, led by crude and this has started to reflect in the lower cost of goods sold.”

Finance cost dropped to Rs 4.24 crore from Rs 18.20 crore but tax expenses more than doubled to Rs 518.66 crore in Q3FY15 from Rs 247.50 crore in Q3FY14.