Sharekhan's research report on Hindustan Unilever
HUL’s volume growth rose q-o-q in Q1FY26 to 3% (versus 2%/0% in Q4/Q3FY25, respectively). Standalone revenues grew ~4% y-o-y, while OPM fell 117 bps y-o-y to 22.3%. Adjusted PAT grew by 10% y-o-y led by lower tax rate due to re-estimation of tax provisions. Management has maintained guidance for H1FY26 to be better than H2FY25 with a focus on competitive volume-led growth driven by portfolio transformation and improving macros. Gross margins to improve sequentially, but OPM is likely to be rangebound at 22-23% due to reinvestment to drive revenue.
Outlook
Stock trades at 57x and 51x its FY26E and FY27E EPS, respectively. We retain a Buy with a revised PT of Rs. 2,832.
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