1
Please refer to important disclosures at the end of this report
1
1
Hindustan Unilever Limited (HUL) is engaged in fast-moving consumer goods
business comprising home and personal care, foods and refreshments. Market
growth has stabilized post demonetisation, however rural and wholesale sales
continue to remain under pressure; HUL will be focusing on improving its direct
coverage reach. In FY18, HUL will introduce Tresemme Botonique and Clinic
Plus+ Aurveda Care shampoos in natural care portfolio, it will also launch Citra
hair oil. HUL expects that there will be volume recovery and healthy EBITDA
margin expansion in years to come. Going forward, it is expected that with the
gradual pick-up in rural demand, benefits of GST and direct distribution and
continued innovation will drive strong revenue growth for HUL. Further, pricing
growth and cost control will drive margin expansion going forward. The
company's cash flows from operations have been reporting consistently above
`3500cr from FY13 to FY16 which are sufficient to fund its capital expenditure
requirements. HUL continues to reflect the company's market leadership across
segments with strong brand presence and high operating efficiency which will
demonstrate healthy revenue growth in the medium to long term. The Company
is virtually debt free and has a good return on equity (ROE) of 110.25% for the
last 3 years. The company has been maintaining a healthy dividend payout of
77.61% (Div yield: 1.6%). Hence Buy.
BUY
CMP `1,020
52 Week High / Low
1032/783
Avg. Daily Volume
1,15,655
FMCG
Market Cap (` cr)
2,20,785
1
BSE Sensex
30,365
Nifty
9,386
Face Value (`)
Reuters Code
HLL.BO
HUVR@IN
0.7
Vaibhav Agrawal
022 3935 7800 Ext: 6808
[email protected]gelbroking.com
Hindustan Unilever
Others | FMCG
May 24, 2017
2
Hindustan Unilever | FMCG
May 24, 2017
2
Research Team Tel: 022 - 39357800 E-mail: [email protected] Website: www.angelbroking.com
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Disclosure of Interest Statement Hindustan Unilever
1. Financial interest of research analyst or Angel or his Associate or his relative No
2. Ownership of 1% or more of the stock by research analyst or Angel or associates or relatives No
3. Served as an officer, director or employee of the company covered under Research No
4. Broking relationship with company covered under Research No
Ratings (Based on expected returns Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%)
over 12 months investment period): Reduce (-5% to -15%) Sell (< -15)