HUL Aims To Make Core Brands 'Desirable'; Eyes Volume Growth The company believes the latest GST reforms will drive consumption, expected to increase disposable income and improve consumer sentiment
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FMCG major HUL's (Hindustan Unilever Ltd) new CEO eyes volume-led growth in the mid-to-long term with an aim to make core brands more modern, desirable and youthful. The company believes the latest GST reforms will drive consumption, expected to increase disposable income and improve consumer sentiment.
HUL reported an increase of 3.8 per cent in consolidated net profit at INR 2,694 crore for the second quarter ending September 2025.
"We anticipate normal trading conditions starting early November, once prices stabilize, paving the way for a gradual and sustained market recovery. We are investing disproportionately to scale our high-growth demand spaces," said Priya Nair, CEO and MD, HUL, who was appointed effective August 2025.
"Looking ahead, we are determined to accelerate our portfolio transformation by radically sharpening our consumer segmentation, being bolder in transforming our core brands to make them more modern, desirable and youthful, future-proofing our marketing & sales capabilities by enabling superior online brand discovery & fulfillment. We believe these key priorities, coupled with a supportive macroeconomic environment, will position us to accelerate volume-led growth in the mid-to-long term," she added.
In the quarter, home care delivered mid-single digit underlying volume growth (UVG) offset by price reductions taken in previous quarters, resulting in a flat underlying sales growth (USG). Beauty & Wellbeing delivered five per cent USG driven by skin care and health & wellbeing. Hair care continued to strengthen its market leadership in the quarter. However, turnover declined year-on-year due to the transitory impact of GST rate rationalisation. Personal care turnover growth was flat, impacted by GST rate transition in the quarter.
Foods delivered three per cent USG with low-single digit UVG. Beverages (Tea and Coffee) grew in double-digits. Tea saw high-single digit growth driven by a mix of price and volume. Coffee sustained its strong double-digit growth momentum. Early green shoots were observed through sustained UVG in lifestyle nutrition. However, turnover declined, driven by pricing actions taken in previous quarters to refine pack-price architecture.
Packaged foods delivered a subdued performance amid GST transition. Ice Cream turnover declined year-on-year on account of prolonged monsoons in parts of the country and GST transition.
Despite headwinds, the CEO noted that the company is a market leader in more than 85 per cent of the business. More than 19 of its brands have an annual turnover of INR 1,000 crore.
According to Yes Securities, HUL's 2QFY26 consolidated headline performance was largely in-line with its subdued expectations amidst disruptions. Consolidated UVG was flat during the quarter, positively driven by mid-single digit growth in home care and low-single digit growth in the foods segment.
"At an aggregate level there was up to two per cent impact on volumes in 2QFY26 due to the GST rate transition exercise. With GST rate rationalization, there will be some disruption till October but expect steady growth thereon," the report added.
Imputed price growth for the quarter stood at approx 2.1 per cent as positive price growth in skin cleansing, beauty & wellbeing, was partially offset by negative pricing in detergents. Going forward, price growth guidance is maintained in the low single digit range if commodity price remains at current level.
