Hindustan Unilever set to focus on bigger brands to chase volumes
Hindustan Unilever managing director Rohit Jawa said he is neither satisfied with the company's volume growth nor has the company lost its pricing power as the consumer bellwether shifts focus on investing disproportionately on bigger and more premium brands.
«We don't want volume to be just 2% and want to see it grow — that is our focus. We are not going to wait for the macros to improve, but we'll go where the growth is and work actively towards that,» Jawa told ET, adding that tailwinds including improving macros and agri-economy will benefit HUL.
«But in meantime, we are not waiting, we are going to do what we can do. That will only make us stronger because we are chasing more volume and more mix by going more and more into high-growth spaces, channels, and formats and putting more funds and people there.» In March quarter, HUL reported a 6% drop in net profit while revenue remained unchanged.
According to the company, the latest quarterly performance of no pricing growth is the carry-forward of price cuts in segments such as laundry and soaps that are highly price-sensitive. «There are parts of our business where we raise prices not linked to inflation because there's higher desirability and better quality. In some categories, we have to lower prices and match the price points because consumers need a sweet spot for us to remain sustainable. And we still make good margins on it. Therefore, it's not about lack of pricing power.»
In past four quarters, companies have been slashing prices amid visible consumer
