HUL Q2 results today: Here’s what to track

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FMCG major Hindustan Unilever is set to announce its financial results for the September quarter on Friday.

Brokerage firm HDFC Securities expects HUL to post revenue growth of 13 per cent in July-September, with 17.50 per cent year-on-year rise in adjusted profit after tax. The brokerage house sees adjusted EPS at Rs 5.70 over Rs 6.7 in Q2 of FY18. EBITDA may rise 18.3 per cent on a year-on-year basis.

Improvement in rural business, commentary on competition, especially in natural products and oral care, pricing actions as well as new launch strategy are among key monitorables in the quarterly numbers of the FMCG firm.

The stock was up 1.18 per cent at Rs 1,546.60 on the BSE today ahead of the quarterly numbers.

According to Nirmal Bang Securities, the company is expected to deliver volume-led double-digit revenue growth in Q2 2018-19. It projected volume growth in the range of 8-9 per cent and value growth of around 4 per cent during the quarter.

Volume-led growth assumption is based on broad-based demand for its products across categories, improved performance of select portfolios and new products like the launch of Brylcream range exclusively on Amazon. Home and personal care segment will continue to drive growth while the merger of food and refreshment businesses is likely to bring in synergy and efficiency.

On the cost side, the pressure has accelerated, with crude oil prices moving up. But other key raw materials like PFAD, palm oil and the like have declined on a YoY basis. “We do not expect adverse impact of crude this quarter. We, therefore, expect operating margin expansion of 80 bps YoY led by robust growth of premium portfolio, operating leverage and stringent cost rationalisation measures like Zero Base Budgeting (ZBB),” Nirmal Bang said.

The brokerage house sees 12 per cent, 16.90 per cent and 12.70 per cent YOY rise in HUL’s net profit, EBITDA and net sales, respectively, for the quarter in question.

Source: Economic Times