Hindustan Unilever Ltd (Q2 FY14)

India Infoline News Service | Mumbai |

HUL registered ~10% yoy growth in revenues in line with our expectations at ~Rs67bn. The growth could have been even better but slower ~9% yoy growth in core HPC segment

CMP Rs589, Target Rs597, Upside 1.4%

  • HUL registered ~10% yoy growth in revenues in line with our expectations at ~Rs67bn. The growth could have been even better but slower ~9% yoy growth in core HPC segment

  • Underlying volume growth for the quarter stood at ~5% yoy led by healthy growth in skin care segment on a low base

  • Soaps and Detergents and Personal products segment witnessed a 30bps/140bps decline in EBIT margins respectively. Personal products segment margins were impacted by sharp increase in A&P investment and slowdown in discretionary spends

  • Despite higher adspend and staff cost, OPM expanded by 60bps to 13.9%, aided by softening key input prices. Net profit after extraordinary items of Rs334mn increased by ~13% yoy to Rs9.1bn

  • Maintain Market Performer with 9-mth target price of Rs597 

Result table (Standalone)
(Rs m)
Q2 FY14
Q2 FY13
% yoy
Q1 FY14
% qoq
Net sales
67,472
61,554
9.6
66,875
0.9
Material cost
(34,699)
(32,695)
6.1
(34,828)
(0.4)
Personnel cost
(3,683)
(3,305)
11.4
(3,417)
7.8
Advertising cost
(9,540)
(7,690)
24.1
(8,898)
7.2
Other overheads
(10,151)
(9,652)
5.2
(10,092)
0.6
Operating profit
9,399
8,213
14.4
9,640
(2.5)
OPM (%)
13.9
13.3
59 bps
14.4
(49) bps
Depreciation
(639)
(577)
10.8
(664)
(3.8)
Interest
(63)
(63)
(0.8)
(62)
1.0
Other income
2,964
3,042
(2.5)
2,983
(0.6)
PBT
11,661
10,615
9.9
11,897
(2.0)
Tax
(2,857)
(2,561)
11.6
(2,767)
3.3
Effective tax rate (%)
24.5
24.1
-
23.3
-
Adjusted PAT
8,804
8,053
9.3
9,130
(3.6)
Adj. PAT margin (%)
13.0
13.1
(4) bps
13.7
(60) bps
BSE 1,323.25 [0.40] ([0.03]%)
NSE 1,324.55 2.95 (0.22%)

***Note: This is a NSE Chart

 

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