HUL share price drops over 2% after muted Q3 results; should you buy, sell or hold the stock?
₹2,492.65 apiece on the BSE. HUL posted a standalone net profit of ₹2,519 crore for the third quarter of FY24, a growth of just 0.55% from ₹2,505 crore in the same quarter of last fiscal year. However, HUL’s Q3 net profit declined 7.28% from ₹2,717 crore on a sequential basis.
The company’s total revenue in Q3FY24 fell 0.38% to ₹14,928 crore from ₹14,986 crore, YoY. Revenue dropped 0.6% from ₹15,027 crore in the September 2023 quarter. The company saw an underlying volume growth (UVG) of 2%.
Also Read: Reliance share price in focus after Q3 results 2024. Buy, sell, or hold? At the operational level, EBITDA was flat at ₹3,540 crore, while EBITDA margins improved by 10 basis points YoY to 23.7%. HUL’s Home Care segment saw a marginal decline in revenue with mid-single digit UVG in the quarter.
However, on a 2-year CAGR basis, the business delivered a strong double-digit growth of 14% with high single digit UVG. (Exciting news! Mint is now on WhatsApp Channels Subscribe today by clicking the link and stay updated with the latest financial insights! Click here!) Beauty & Personal Care business saw mid-single digit volume growth led by Hair and Premium Skin, while Foods & Refreshment segment revenue grew 1%. The price led growth was driven by the market development portfolio.
“We believe demand slowdown, competitive pressure, distribution stress, and rising royalty rates are likely to have an overhang on HUL’s valuations (46x P/E for FY26). Management commentary on demand setting remains unexciting, as demand recovery remains a hope on the emergence of tailwinds," Emkay Global Financial Services said. Also Read: Paytm share price rises over 3% after Q3 result; what should investors do? It believes reinforcing the general
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