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Revenue
₹15,567 Cr
verified against source
Revenue YoY
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reported change
EBITDA
Pending
latest reported figure
Source
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Actual signal trajectory
Where this quarter sits.
Quarter read
What the record says.
HUL reported a resilient quarter with 2% underlying volume growth and EBITDA margin of 23.7%, up 10bps YoY. Revenue was flat due to negative price growth of 2%, driven by price cuts in Home Care and BPC. The F&R segment saw low single-digit volume decline due to tea downgrading and coffee inflation. Management highlighted that 60% of business is winning market share on a MAT basis, though this is expected to dip below 60% for a couple of quarters. Premium portfolio grew 2.5x faster than mass. A&P spend was up 33% YoY in 9M FY24. Guidance: expect gradual rural recovery, marginal negative price growth in Q4, and continued investment in brands and capabilities. Risk: rural demand recovery may be slower than expected if winter crop yields disappoint.
Colored figures show movement against the previous available record.
Guidance to track
- If commodity prices remain at current levels, management expects underlying price growth to be marginally negative in the March quarter.
- Management aims to maintain EBITDA margins at current healthy levels, with a focus on gross margin improvement back to pre-COVID levels.
- The MAT business winning metric is expected to dip below 60% for a couple of quarters before recovering above 60% in the second half of calendar 2024.
- Management plans to further increase investments behind brands, innovation, and digital capabilities, funded by gross margin expansion.
Risks flagged
- Rural consumer sentiment remains subdued due to lower agriculture yields and income uncertainty; recovery pace depends on winter crop yields and government spending.
- Benign commodity environment has led to increased competition from regional players, particularly in detergent bars and tea, impacting market share momentum.
- The termination of the GSK distribution agreement will result in the loss of approximately INR 300 crore annual income, impacting margins from next quarter.
- Consumers continue to downgrade from branded tea to loose tea due to price differentials, pressuring F&R volumes despite value and volume market share gains.
Key quotes
- We are a full portfolio play company. We are an all-weather portfolio. We sell and serve to consumers in all tiers of the market.
- Our absolute A&P spend in nine months of this fiscal is 33% higher than the same period last year.
- We expect our MAT Business Winning metric to be impacted as we lap the high base. We expect it to dip below 60% for a couple of quarters before coming back towards second half of calendar year 2024.
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