Q3FY24 Preview: Hindustan Unilever: Revenue seen at Rs. 1,54,671 million, PAT at Rs. 26,381 million

17 Jan 2024 , 10:59 AM

Result date: January 19, 2023

Recommendation: Add

Target price: Rs. 2,800

Analysts at IIFL Capital Services expect Hindustan Unilever (HUL) to witness volume growth of 2% in the December quarter as compared to the year-ago quarter. Slowing demand in rural markets coupled with increased competitive intensity are likely to weigh on volume growth during the quarter. Negative pricing growth though could lead to just a 1% growth in consolidated revenue of the company.              

EBITDA margin could moderate sequentially to 24.5% versus 24.8% in the September quarter. Elevated level of ad spends and royalty payments will be key pressure points on the company’s margins during the year.

HUL could post 3.5% growth in its Profit After Tax (PAT) as compared to the year-ago quarter.

Important management insights to watch out for:

• Demand outlook across segments, both in rural and urban markets 
• Competitive intensity
• Trends in raw material costs, pricing action and margins

Rs. Million	December 2023 estimates	YoY change
Revenue	1,54,671	1.0%
EBITDA	37,891	2.6%
Profit After Tax	26,381	3.5%

Source: IIFL Research