Price increases save the day for HUL

Weak revenues and operating profit margins pull down the company's earnings

Hindustan Unilever Ltd (HUL)’s December quarter (Q3) results were broadly on expected lines with net revenues (including other operating income) down 0.7 per cent at Rs 7,706 crore and net profit before exceptional items down 10 per cent at Rs 920 crore, over a year ago. Although this is the first decline in revenue and profits after many quarters, note that expectations were already muted in anticipation of pressures from cash crunch caused by demonetisation. The worry is what the near future holds.

Results give a glimpse of the demand and, to some extent, the outlook: Both not good. Demand