HUL - Unilever Plc’s Power Brand Strategy, Implications For India: ICICI Securities

ICICI Securities Report

Unilever Plc recently highlighted significant shifts in its priorities – one of them is driving faster growth through 'power brands' top-30 brands’ focus 14 have revenues greater €1 billion and 16 others.

While this may be the most appropriate strategy for Unilever Plc, we hope this does not constrain country/region-specific brands in India (we estimate such brands account for ~30% of Hindustan Unilever Ltd.’s revenue; brands like Glow and Lovely, Wheel, Brooke Bond, Clinic Plus, Kissan, Bru, Lakme etc. are 'Not' in the top-30 list globally).

Unilever Plc had embarked on a power brand strategy around CY2000 (30 power brands in India versus 63) and the results were suboptimal (revenue compound annual growth rate of ~4% over CY2000-10 and material market share losses).

We note that while profit pay-offs may come early, revenue growth revival has its own gravity. We hope, 'this time it’s different'.

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