HUL - Journey Toward Sustainable Growth: Motilal Oswal

Motilal Oswal Report

Hindustan Unilever Ltd. has consistently reinforced the fundamental factors that have contributed to its success in India. They include:

1. embracing technology to gather valuable data and enable informed decision-making,

2. adopting the ‘Winning in Many Indias’ strategy that emphasises decentralization and tailored approaches,

3. identifying emerging trends and proactively investing in them,

4. reinvesting cost savings into the business, and

5. showcasing exceptional execution capabilities that have led to consistent earnings growth.

We also believe that HUL is the best prepared among peers in terms of technology and e-commerce strategy to deal with potentially significant disruptions going forward.

We believe that HUL’s volume growth has bottomed out and expect a gradual volume recovery in FY25. HUL’s wide product basket and presence across price segments should help the company achieve a steady growth recovery.

There is scope for a turnaround in part of beauty and personal care and F&R; we will monitor the execution in these segments under the new CEO.

We reiterate our Buy rating with a target price of Rs 2,900, based on 55 times FY26E EPS.

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