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HUL - Resilient Demand, Peaked Out Inflation: Prabhudas Lilladher

HUL - Resilient Demand, Peaked Out Inflation: Prabhudas Lilladher

Sachets of Hindustan Unilever Ltd. Sunsilk shampoo and Dove shampoo are displayed for sale above a store. (Photographer: Kuni Takahashi/Bloomberg)
Sachets of Hindustan Unilever Ltd. Sunsilk shampoo and Dove shampoo are displayed for sale above a store. (Photographer: Kuni Takahashi/Bloomberg)

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Prabhudas Lilladher Report

We expect Hindustan Unilever Ltd. to witness month-on-month improvement in demand since June-21 aided by resilient rural demand and improving urban demand.

Inflation in palm oil and crude is likely to pressurise margins, however the intensity will be likely lower than Q1 FY22.

Calibrated price hikes will not be sufficient to ward off the inflation in input costs and higher intensity in ad-spends.

We estimate 8% volume and 4% growth in realisations during Q2 FY22.

Ebitda and profit after tax is estimated to grow at 9.4% (Rs 31.4 billion) and 9.3% (Rs 22.3 billion).

HUL’s strategy to introduce consumers to bottom of pyramid products and then moving them up to premium products will continue providing competitive growth.

Click on the attachment to read the full report:

Prabhudas Lilldher HUL Company Update.pdf

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