Hindustan Unilever Ltd (Q4 FY16): Volume growth dissapoints; margin expands - Not Rated
CMP: Rs846
² HUL's Q4FY16 result was in-line with estimates, though volume growth of just 4% as against our expectation of 5% disappoints. The volume growth was impacted by the phase out of excise benefits and one-off credits (110bps). Negating the impact, the volume growth would have been 5%.
² Net revenue grew by just 3.5% to Rs7,946cr. The gross margin expanded by 242bps to 52.6%. With other costs relatively stable, the EBITDA margin expands by 129bps to 18.5%. PBIT grew by 10.6% to Rs1,379cr, margin expands by 110bps (50bps impact due to phasing out of excise benefits and one-off credits). With lower tax rate to the tune of 27.6% as against 33.3% in Q4FY15, PAT ex one-offs, reported 24.8% growth to Rs1,047cr.
² Key Positives: (1) After posting 2 quarters of flattish/declining margins in Soaps & Detergents, the company reported 123bps expansion; (2) Margin expanded across Personal Products (PP)/Beverages/Packaged food by 174bps/58bps/39bps, respectively; and (3) 10 successive quarters of double digit growth in packaged foods segment with 11.7% growth.
² Key Negatives: PP reported 2.8% revenue growth (slowest in 11 quarters) as it was impacted by phasing out of excise benefits and one-off credits and re-alignment of channel spends. However, excluding these one-offs, growth in PP was 7%.
Please find attached a note on the same.
Warm Regards,
Amar Ambani
Head of Research
IIFL
Please help preserve our environment. Avoid printing this report.
You received this message because you are subscribed to the Google Groups "LONGTERMINVESTORSRESEARCH" group.
To unsubscribe from this group and stop receiving emails from it, send an email to longterminvestorsresearch+unsubscribe@googlegroups.com.
Visit this group at https://groups.google.com/group/longterminvestorsresearch.
For more options, visit https://groups.google.com/d/optout.
No comments:
Post a Comment