While most people’s eyes are fixated on the big tech companies’ results like TCS, Infosys and Wipro, or even on Reliance Industries (all of these 4 companies have released their quarterly numbers), there are certain other companies that are always in demand because of their image as safe bets. These are mostly FMCG and pharma companies. And yes, here we are talking about Hindustan Unilever (HUL) and its upcoming Q4 results tomorrow.

HUL Q4 results: Hindustan Unilever Q4 net profit is seen rising 2.71% to 2,538 crore.(Livemint)

No fireworks are seen at all and expectations are that HUL Q4 results will reveal muted earnings growth even though the FMCG sector has seen the gap between urban and rural growth shrink. According to the analysts this aspect is yet to be reflected in the company’s performance. Also, notably, rural demand is dependent on a number of things including softening inflation and higher government expenditure.

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HUL Q4 results Preview

The company may report revenue growth of 1.16% at 15,067 crore, up from 14,893 crore in the year-ago period. This is according to the average estimates of five brokerages. Volume growth is pegged at 3%, LiveMint reported.

Among the adverse impacts is a 75 crore hit on sales because of the expiration of GSK consignment arrangement.

HUL Q4 net profit for the quarter is seen rising 2.71% to 2,538 crore from 2,471 crore, YoY.

Nuvama Institutional Equities summarised it this way, “We anticipate demand trends to be similar to Q3FY24 with marginal improvement in rural (across categories) on a two-year basis. Urban continues to grow faster than rural and premium continues to do better than mass for HUL.”

At the operating level, EBITDA is expected to increase 0.60% to 3,492 crore from 3,471 crore, YoY, while EBITDA margin is estimated to remain flat at 23.2%, YoY. Reason behind this may be the increased intensity in ad spend and jump in other expenses.

Motilal Oswal Financial Services sees the company reporting 3% YoY domestic volume growth. It indicated that the increase in royalty rates and the termination of the distribution agreement for OTC and oral care products of GSK will impact EBITDA. Gross margins are expected to expand 150 bps YoY due to lower raw material costs.

And how has the HUL share price performed? Well, it has dropped over 15% in 2024. Over the past 1 year, it is down just over 9%.

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