News By/Courtesy: Arnav Kaushik | 21 Sep 2020 22:21pm IST

HIGHLIGHTS

  • HUL shares down with three percent on the BSE
  • FMCG was trading at its lowest level since May 29
  • HUL experiences fall in the share price just after the lockdown

Hindustan Unilever (HUL) was under pressure, As its shares are hitting over a three-month low of Rs 2,042, down 3 percent on the BSE in the intra-day trade on Monday. The stock of the fast-moving consumer goods company (FMCG) was trading at its lowest level since May 29, 2020, since after the lockdown.

From over the past two months, HUL has underperformed the market by falling 12 percent after it reported a mixed set of numbers for the quarter ended June 30, 2020 (Q1). In comparison, the S&P BSE Sensex has risen 2 percent during the period. The company paid a dividend of Rs 23.50, including a special dividend of Rs 9.50 per share since June.

While profit before tax (PBT) for the period fell 6 percent year-on-year (YoY) to Rs 2,411 crore, the company's revenue increased 4.4 percent YoY to Rs 10,560 crore, thanks to the merger of GSK Consumer nutrition brands with the companies. Excluding the GSK business, overall revenue declined 7 percent in the quarter. Operating profit, however, fell 0.1 percent to Rs 2,644 crore in Q1, while operating margins narrowed to 25 percent from 26.2 percent a year ago.

"Constraints continue due to restrictions in several parts of the country and the near-term demand outlook remains uncertain," the management had said while announcing Q1 results on July 21.

Localized lockdowns may affect near-term volumes, but the brokerage firm expects volumes and earnings to bounce back once the situation normalizes. They expect premiumization to sustain (albeit delayed) and hence expect better earnings growth.

 

This article does not intend to hurt the sentiments of any individual, community, sect, or religion, etcetera. This article is based purely on the author’s personal opinion and views in the exercise of the Fundamental Rights guaranteed under Article 19(1)(A) and other related laws being enforced in India for the time being.

Section Editor: Pushpit Singh | 22 Sep 2020 7:20am IST


Tags : #business #BSE #stock #Hindustanunilever

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