HUL Shares Fall Over 3% After Q3 Results; Should You Buy, Sell Or Hold? – News18
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Despite reporting a 19% year-on-year (YoY) increase in net profit to Rs 3,001 crore, the stock saw a decline
HUL Share Price
Hindustan Unilever Ltd. (HUL) shares fell 3.6% in early trading on Thursday, January 23, hitting an intraday low of Rs 2,258.65 on the BSE, following the company’s Q3 earnings report. Despite reporting a 19% year-on-year (YoY) increase in net profit to Rs 3,001 crore, the stock saw a decline.
On a sequential basis, net profit rose by 15.2%. Consolidated revenue grew by 1.9% YoY to Rs 15,559 crore, but saw a slight decline of nearly 1% compared to the previous quarter. EBITDA for the quarter stood at Rs 3,695 crore, up slightly from Rs 3,666 crore in Q3FY24, though the EBITDA margin fell by 30 basis points to 23.7%.
After Hindustan Unilever’s (HUL) Q3 results, several brokerages lowered their target prices while maintaining their ratings.
ICICI Securities kept its ‘Add’ rating but reduced its target price to Rs 2,500 per share from Rs 2,950. The brokerage also revised its earnings estimates down by 6% for FY25E and 8% for FY26E, primarily due to lower expectations for volume growth and margins. The Q3FY25 results were below ICICI’s expectations, with underperformance in mass brands and consumers shifting to smaller packs. Revenue growth of 2% YoY was attributed to price hikes rather than volume growth. ICICI Securities noted that while HUL is making strategic changes, including the acquisition of Minimalist, the transformation may be challenging in the current macroeconomic environment.
Similarly, Nuvama Institutional Equities maintained a ‘Buy’ rating on HUL but cut its target price to Rs 3,225 per share from Rs 3,395. Nuvama lowered its earnings per share (EPS) estimates for FY25E/26E/27E by 3%, 5%, and 5%, respectively, due to raw material inflation. The brokerage considered HUL’s Q3 results in line with its expectations, with revenue and EBITDA growth of 1.4% and 0.8% YoY, respectively. However, volumes remained flat YoY, with certain segments like tea and soaps experiencing a decline. Nuvama also noted that the skin care portfolio (excluding winter products) saw mid-single-digit growth.
Emkay Global Financial Services reiterated its ‘Buy’ rating on HUL with a Dec-25 target price of Rs 2,675 per share, based on a 51x price-to-earnings (P/E) multiple, which is a 5% discount to the stock’s 5-year average P/E. Despite a subdued performance and a cautious near-term outlook, Emkay remains positive on HUL’s medium-term prospects, expecting improved execution and better results once external consumption conditions improve.
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