In 6 years, HUL doubled profits in key categories: Sanjiv Mehta

MUMBAI: India’s biggest pure-play consumer company by market value Hindustan Unilever’s sales and profitability of key categories nearly doubled over the last six years while market capitalisation rose four times to $49 billion, the company’s top official said.

“In the last six years, laundry turnover grew 1.8 times while profitability rose 3.7 times. Hair care portfolio grew share by about 700 basis points and sales nearly doubled while it became the largest tea maker with sales growing 1.8 times while profits doubled in the segment,” said Sanjiv Mehta, chairman, HUL, at an investor presentation at CLSA Investor Conference 2018 at Hong Kong.

In the past few years, drought and lower minimum support prices for farm produce had hit rural demand. The local unit of the Anglo-Dutch company, for long considered a good proxy to gauge consumer sentiment across the socio-economic spectrum, said markets are showing early signs of revival with tailwinds that includes good monsoon, higher minimum support price and upcoming elections.

HUL also said in a country of over six lakh villages and 10 million outlets, general trade will remain an important channel even after 10 years but its growth and profitability is higher in e-commerce, which in turn is faster than modern trade.

Patanjali’s sudden rise over the past few years has made most rivals shift focus to the rejuvenated herbal sector. HUL relaunched Ayush brand of ayurvedic personal care products, acquired Indulekha haircare brand and launched Citra skincare brand.

“Naturals portfolio is growing at more than 2.5 times of overall HUL average while growth of Indulekha has exceeded our acquisition business case,” added Mehta in the presentation uploaded on the Bombay Stock Exchange. Kerala based hair-care brand Indulekha, which was bought by HUL for Rs 330 crore two years ago, has seen sales grow five times during the June quarter this year compared to March quarter 2017.