Hindustan Unilever Ltd. is “evaluating various options" for its ice cream business, in light of Unilever's upcoming demerger.
“The ice cream business has an inherently different business model, including a cold-chain go-to-market operating model, seasonality, and a different innovation rhythm compared to the rest of Unilever's business," an HUL spokesperson said. "As far as the Indian ice cream business is concerned, we are evaluating the various options in light of this announcement. We will discuss this with the HUL board and Unilever management in the coming months."
Parent Unilever has announced its decision to demerge its €7.9 billion ice cream unit by the end of 2025.
Unilever will cut 7,500 jobs globally as part of a new programme that's expected to save it about €800 million over the next three years.
HUL said that in India it has a “very robust" cost-savings program called 'Symphony'. “Through an end-to-end focus across all lines of the P&L, we have been generating gross savings of 6% of turnover every year," the spokersperson said.
This provides the company with crucial fuel for growth, allowing it to invest competitively behind its brands and future capabilities, they said. “We will closely assess the global initiatives of Unilever under the productivity programme and assimilate best practices to take Symphony to its next phase."
However, there is "a low probability" of any big change in HUL, according to Abneesh Roy, analyst at Nuvama Securities. "The ice cream business for HUL is less than 3% of its India business. But for parent Unilever, it is around 13-15%... Important to note that in the tea business, HUL chose to retain it, while its parent sold off other countries' businesses."
The makers of Kwality Wall's, Cornetto, and Magnum reported total revenue from operations of Rs 59,144 crore in FY23.
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