Higher royalty & dull results take sheen off HUL

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fe Bureau: Mumbai, Jan 23 2013, 01:00 IST

sum payments for transfer of technology, payments for the use of trademark and brand name. Foreign sponsors who earlier required government approval for charging royalty under the various heads were now free to charge any amount as royalty to their Indian subsidiaries.

The top 20 royalty paying companies now remit R3,601 crore, up from R1,196 crore five years ago. A study conducted by IIAS found that total royalty for 25 companies has increased to R3,635 crore in 2011-12, up from R1,528 crore in 2007-08. Maruti Suzuki has consistently paid the highest royalty and the R1,803 crore paid in FY12 accounts for 5.2% of its net sales.

HUL pays royalties on specific brands, where Unilever owns the patents and pays royalties on sales of products manufactured with technical inputs developed by Unilever. HUL had a turnover of R22,116 crore for the fiscal 2011-12. Over a two year period, the Sensex has returned 19.5% while HUL gained 25%.

“The pace of innovations and the scope of services have expanded over the years, and as a consequence, HUL is enjoying the benefits of an increasing stream of new products and innovations, backed by technology and knowhow from Unilever,” HUL said in a media statement.

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Sensex dips below 20k-mark, down over 120pts on profit-booking, FMCG, PSU stocks sink Tata Sponge Q3 net up 23% at Rs 20.58 crHigher royalty, dull results take sheen off Hindustan Unilever Indiabulls Securities Q3 net profit up 46% at Rs 18.04 crore

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