Buy Hindustan Unilever; target of Rs 1515: Motilal Oswal
Motilal Oswal is bullish on Hindustan Unilever has recommended buy rating on the stock with a target price of Rs 1515 in its research report dated March 16, 2018.
April 05, 2018 / 06:01 PM IST
Motilal Oswal's research report on Hindustan Unilever
Market demand has been improving gradually over the past few quarters. Encouragingly, growth has been broad-based across categories and regions.Central India continues to do better than the rest of the regions for HUL, in line with the company’s strategy. Although rural performance has improved substantially, rural demand growth is yet to reach the buoyant historical levels, when it was 1.5-2x of urban demand growth. 3QFY18 had the benefit of a low base, which would be missing in 4QFY18.
Consequently, we expect 18.8% EPS growth over FY17-20, as against 6.1%/10.6%/10.7% EPS CAGR over the last 3/5/10 years. We maintain our Buy rating with a revised target price of INR1,515 – a target multiple of 46x and moving to Mar’19E EPS (5% premium to three-year average due to significantly improved business fundamentals).
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