Looking ahead, we expect near-term consumer demand to remain subdued; commodity and currency will continue to remain volatile, HUL said.
The ongoing consumer slowdown dragging on Indian FMCG industry will likely continue to weigh in the coming months as well, a top executive at India’s largest FMCG maker Hindustan Unilever said on Tuesday. “Looking ahead, we expect near-term consumer demand to remain subdued; commodity and currency will continue to remain volatile,” HUL CFO Srinivas Phatak told reporters after the release of the company’s fiscal first-quarter results. The FMCG major posted an over 14 per cent rise in consolidated net profit to Rs 1,795 crore for the quarter ended June 30. The company also witnessed a domestic consumer growth at 7 per cent with underlying volume growth at 5 per cent, it announced in a BSE filing.
“Against the backdrop of moderate market growth, HUL has delivered a resilient performance driven by the expansion of our consumer franchise, improvement in portfolio mix and sustained growth in margins,” HUL CMD Sanjiv Mehta said.
Key takeaways from Q1 results
- Hindustan Unilever, the Indian subsidiary of British-Dutch Unilever earned a net profit of Rs 1,795 crore in April-June this financial year, versus Rs 1,569 crore in the April-June quarter of the last fiscal.
- The company’s net sales stood at Rs 10,197 crore as against Rs 9,616 crore in the corresponding period a year ago. This is a rise of 6.04 per cent.
- HUL’s total expenses for the quarter were Rs 7,896 crore. The same has also seen an increase of 3.84 per cent, compared to Rs 7,604 crore in the last comparable period.
Meanwhile, another leading FMCG brand Dabur had also released its fiscal first-quarter results a few days back. The company said that it recorded double-digit profit growth in Q1 volumes despite slowdown and heavy competition.
Major FMCG companies had borne the brunt of a consumer slowdown in the last quarter. In fact, it was HUL’s statement that brought the consumer demand slump to attention of analysts. HUL had said that “FMCG is recession resilient, not recession-proof.” A Kotak report had then said that for a company that is generally cautious with words, HUL’s nuanced statement could mean that the situation is worse than imagined.