Hindustan Unilever, India’s biggest soaps and detergent maker, on Wednesday said fiscal second quarter profit grew 16.4 per cent, beating analysts expectation, helped by gradual stabilising of wholesale and CSD (canteen store department) channel coupled with a swift transition to GST.
“While transition to GST impacted trade purchases in start of the quarter, consumer off take remained stable and the whole sale channel is steadily normalising,” Hindustan Unilever said in a statement to the exchanges on Wednesday.
Net profit rose to Rs 1,276 crore in the July-Sept quarter compared to Rs 1,096 crore in the corresponding period year ago.
A Tickernews poll of brokerages showed that the company was likely to witness a 15 per cent growth in its net profit to Rs 1,250 crore for the second quarter.
The revenue was seen surging to Rs 8,397 crore along with a 100 bps expansion in the gross margins.
Earnings before interest, tax depreciation and amortisation (Ebitda) for the quarter grew by 20 per cent and stood at Rs 1,682 crore while comparable Ebit margin improved by 180 bps at 20.2 per cent on-year, led by a softening in commodity prices.
Net sales grew 6.5 per cent to Rs 8,199 crore in the fiscal second quarter compared to Rs 8,335 crore in the year ago period that was supported by 3-6 per cent price cuts, mainly in the soaps and detergents category, done in order to pass on the GST benefits. “We were able to swiftly implement GST and pass on the benefits through price reductions to consumers across the country,” said Harish Manwani, chairman, Hindustan Unilever.
The Mumbai-based company’s advertisement spends for the quarter jumped 142 basis points for the second quarter to support its new launches.
The refreshment segment grew by 4.53 per cent to Rs 1,222 crore in the quarter due to on strong broad-based growth in tea coupled with robust volume growth in frozen desserts and Ice cream division.
The food segment grew by 1.43 per cent in the period to Rs 282 crore on launch variants in Knorr soups and noodles division.
Personal care segment registered a double digit growth of Rs 3,910 crore, led by higher demand for Dove, Indulekha and colour cosmetics, but revenue slipped 2.92 per cent on year.
The home care segment too clocked robust growth of Rs 273.90 crore but witnessed a fall of 1.36 per cent compared to the year ago period.
However the company’s underlying volume growth rose 4 per cent, meeting the street’s estimate.
––TickerNews Service
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