HUL's market capitalisation hits 67% of its parent company Unilever

Indian FMCG giant's m-cap is touched $77 billion as compared to $115 billion of Unilever that holds 62 per cent in HUL

Hindustan Unilever's (HUL) market capitalisation reached 67 per cent of its parent company Unilever on October 4.  HUL's m-cap touched $77 billion as compared to Unilever's $115 billion, a report in Economic Times (ET) said.

Unilever's m-cap has declined in the past five years, while that of HUL has more than doubled. Unilever's m-cap touched its peak of $180 billion in October 2017.

According to experts quoted in the report, HUL's share price has jumped on the back of increasing rural demand and falling prices of raw materials. The demand for FMCG has also risen due to the ongoing festive season in India. HUL is among the companies that have the deepest rural penetration in India.

The shares of the company have been outperforming other companies in the FMCG sector. In the last quarter (Q1FY23), HUL's shares jumped 19 per cent, while that of the FMCG sector rose 7 per cent. 

Unilever holds 62 per cent in HUL. 

Nomura, in its recent report, said that HUL has outperformed its peers as it has given a better price-value equation to consumers despite high inflation. Nearly 71 per cent of analysts at Bloomberg gave a "buy" rating to HUL shares while 21 per cent gave a "hold" rating. Only 8 per cent have asked the investors to "sell" HUL's stocks. 

Unilever Global Chief Executive Alan Jope in May said that the demand for its products in India may soon outstrip that of the US. 

"An untold story is the amount of digital innovation that's happening in India, how we run our supply chain, route to market innovation, digital innovation, some of the marketing programmes that we are doing there and I hope that what India will be, as it will be a beacon of digital innovation as well as being a powerhouse commercially," Jope told ET.