The country’s largest consumer goods company, Hindustan Unilever (HUL), on Friday said that it was not in discussion with any player to divest its foods business. The clarification came amid speculation of a potential sale after parent Unilever received an inbound offer for its food business from American major McCormick. Unilever, known for brands such as Dove, Vaseline and Lux, said that it was in discussion with McCormick for the same.
Unilever’s move to consider divesting its foods business also comes after it hived off its ice-cream business in 2025 to focus on beauty and wellbeing, personal care and home care. Unilever had said that ice-cream was a capital-intensive business that required dedicated attention. Subsidiary HUL too had demerged and listed its ice-cream business this financial year in line with the global directive. The ice-cream business contributed 3% (Rs 1,800 crore) to HUL’s topline, consisting of brands such as Kwality Wall’s, Cornetto and Magnum.
Quarter of the Topline
In the case of foods, HUL said on Friday that the segment remained an “important and attractive business” for it. Valued at Rs 15,294 crore in terms of size, foods contribute 25% to HUL’s FY25 topline. It is also the company’s second-largest segment after home care, which contributed 37.85% (Rs 22,972 crore) to HUL’s FY25 topline.
The foods business includes beverages (such as Brooke Bond Red Label, Lipton, Taj Mahal and Bru among others), nutrition (Horlicks, Boost) and packaged foods (Kissan, Knorr, Hellman’s mayonnaise).
The HUL management has indicated from time to time that it is looking to expand its play in foods by tapping the growing potential of segments such as packaged foods. But analysts tracking the company say that HUL has been focused on premiumisation in categories such as beauty and wellbeing in line with global strategy of backing “fewer, bigger, but bolder bets”.
From Mass Market to Premium
Unilever’s CEO Fernando Fernandez has been pushing for anchor markets such as the US and India to focus on premiumisation and devote attention to younger consumers and emerging trade channels such as e-commerce away from the long tail of brands, categories and channels.
Last month, HUL announced that it would invest up to Rs 2,000 crore over the next two years to expand manufacturing capacity in fast-growing premium segments across its beauty & wellbeing and home care liquids categories.
“This investment reflects our strategic focus on scaling our brands and creating categories of the future to meet evolving consumer needs. It also underscores our commitment to building a resilient, technology-enabled supply chain,” Priya Nair, CEO & MD, HUL, said.