Hindustan Unilever anticipates a gradual increase in its volume

24 Jul 2023 , 11:16 AM

Even though it has cut prices, raised grammage, and increased ad spending over the previous two quarters, Hindustan Unilever, India’s largest consumer products company, claimed volume recovery could take at least 2-3 quarters.

The whole thing typically stabilizes in two to three quarters. When we reduce or adjust prices, the trade receives the high-priced goods first and liquidates them before passing the savings along to customers. Ritesh Tiwari, chief financial officer at HUL, stated on the company’s quarterly conference call that consumers also have pantry stock at home, often purchased earlier and typically at a higher price point. 

‘And they frequently start noticing reduced-price products as that inventory is cleared out. And we anticipate that they will begin to alter their habits and increase their consumption.

Consumer purchases of HUL goods increased by 3% during the June-end quarter, which is half as much as it did during the same period last year. According to the manufacturer of Rin and Dove, growth over the upcoming quarters will completely be driven by volume, with pricing growth either flat or sliding, if commodity inflation stays at its current level.

Although on a base of volume reduction in the June quarter of 2022, the rural market volume decreased in double digits and turned positive during the April–June quarter. According to HUL, who cited Nielsen data, the market’s growth over the past two years has actually slowed slightly, with rural volumes declining by 4%.

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