HUL's Q4FY16 standalone net profit rises 7% yoy to Rs.1,089.59 crore : Estimates Mixed

The company’s standalone revenue stood at Rs. 7,945.66 crore, up 3.52% yoy but down 0.44% qoq.

May 09, 2016 2:35 IST | India Infoline News Service
Hindustan Unilever (HUL), FMCG behemoth, reported standalone net profit of Rs. 1,089.59 crore for the quarter ended March 31, 2016, registering growth of 7.02% yoy and 12.17% qoq. The company’s revenue stood at Rs. 7,945.66 crore, up 3.52% yoy but down 0.44% qoq.

Its standalone core operating profit of Rs. 1,466.82 crore for the quarter, clocked growth of 11.28% yoy and 2.52% qoq. Operating profit margin for the current quarter at 18.46% expanded by 129 bps yoy and 53 bps qoq.

For the year ended March 31, 2016, the company reported standalone net profit of Rs. 4,082.37 crore, declining by 5.4% yoy. Its standalone revenue for the period stood at Rs. 31,987.17 crore, registering growth of 3.84% yoy.

Hindustan Unilever's core operating profit stood at Rs. 5,729.92 crore, recording growth of 10.02% yoy. Operating margin for the current period at 18.02% expanded by 111 bps yoy.

For the year ended March 31, 2016, the company’s consolidated net profit stood at Rs. 4,082.37 crore, declining by 6.43% yoy. Its revenue for the period stood at Rs. 33,193 crore, registering growth of 3.82% yoy. Operating profit of Rs. 5949 crore, grew 9.89%. OPM stood at 17.92% for the quarter under review, expanded by 99 bps.

HUL Q4FY16: Volume growth disappoints:

HUL’s net revenue grew 3.5%, lower than 4.4% against IIFL of Rs. 8,312 crore. During the quarter, the company reported a 4% volume growth as against IIFL expectation of 5%. The growth in the quarter continued to be impacted by the phasing out of Excise Duty incentives (-110bps), one-time credit for excise duty refund in the base quarter and marginal price de-growth. HUL’s PBT before exceptional increased by 8.6% to Rs. 1,462 crore. Exceptional gain stood at Rs. 43 crore in Q4FY16 as against Rs. 179 crore in Q4FY15. Lastly, PAT increased more or less in line with IIFL estimates.

Result Highlights: (Rs. in crore)

Reported Results IIFL Estimates Variance (%)
Standalone Revenue 7945.66 8311.99 [4.41]
Standalone Net Profit 1089.59 1107.34 [1.60]

Standalone EPS for the quarter stood at Rs. 18.47.

Bloomberg estimated the company’s consolidated net profit at Rs. 1,070 crore.

Corporate Action:
Hindustan Unilever’s board of directors at its meeting held on May 09, 2016, inter alia, recommended a final dividend of Rs. 9.50 for the financial year ended March 31, 2016 on Equity Shares of Re. 1 each. The Company had earlier paid an interim dividend of Rs. 6.50 per share on November 02, 2015. The total dividend for the period amounts to Rs. 16.00 per Equity Share of face value of Re. 1/- each.

Management Comments: Harish Manwani, Chairman commented, “In challenging markets and a deflationary cost environment, we have delivered another year of competitive and profitable growth. The consistency of our performance is a result of managing our business dynamically, and executing our strategy with even greater rigour and discipline. Our sustained focus on investing behind brands, sharpening our executional capabilities and driving market development has enabled us to keep winning with consumers in a rapidly changing market.”
Stock Commentary:

Hindustan Unilever is currently trading at Rs. 864.25, up by 11.3 points or 1.32% from its previous closing of Rs. 852.95 on the BSE.

The scrip opened at Rs. 850 and has touched a high and low of Rs. 869 and Rs. 849 respectively. So far 969206(NSE+BSE) shares were traded on the counter. The current market cap of the company is Rs. 184573 crore.

The BSE group 'A' stock of face value Rs. 1 has touched a 52 week high of Rs. 944 on 08-Jul-2015 and a 52 week low of Rs. 765.35 on 27-Jan-2016. Last one week high and low of the scrip stood at Rs. 869.45 and Rs. 844.8 respectively.

The promoters holding in the company stood at 67.21 % while Institutions and Non-Institutions held 19 % and 13.79 % respectively.

The stock is currently trading below its 50 DMA.

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