Despite trade adopting a cautious approach in the run-up to GST implementation, Hindustan Unilever Ltd beat market expectations to report a 9 per cent increase in its first quarter profit to ₹1,283 crore compared with ₹1,174 crore in the corresponding quarter last year.
The underlying volume growth was, however, flat due to disruption ahead of GST rollout. In the March quarter, volumes had grown by 4 per cent.
Despite the flat volume growth, HUL’s gross revenues increased 4.7 per cent.
“Under volatile market conditions, domestic consumer business grew at 6 per cent. During the quarter, trade sentiment remained cautious, particularly in the run-up to GST implementation. Despite high promotional intensity, stock pipelines remained low and varied across categories, channels and geographies,” HUL said in a statement.
This quarter saw strong growth across mass and premium laundry.
However, the water business was muted due to lower trade purchases and destocking before GST implementation. Personal wash witnessed broad-based growth across all brands.
Harish Manwani, Chairman, said: “Despite the short-term challenges of this transition (GST), our company delivered yet another resilient performance. Both growth and margin improvement were delivered through a combination of sustained innovations, a comprehensive savings program and a relentless focus on execution in the market place. We remain positive on the medium term outlook for the industry and will continue to drive consumer value, which also delivers profitable volume driven growth for the company.”