Nuvama sets ₹2,820 target for HUL after Q1 FY27 results

HUL reported a 3% year-on-year decline in consolidated net profit to ₹2,673 crore for the quarter ended June 30, 2026 (Q1 FY27), despite a one-off tax credit. Total income rose 10% YoY to ₹17,341 crore, while EBITDA increased to ₹3,947 crore from ₹3,640 crore a year earlier. However, EBITDA margin narrowed to 22.76% from 23.1% due to higher input costs and market volatility.

The company aims to generate 500 basis points of savings through premium mix improvement, operating leverage, its Future Savings Lab, and AI-led media effectiveness. Incremental revenue growth is expected to be split as 40% from consumption and premiumisation, 40% from market making, and 20% from new spaces.

Capex is planned to rise from 2% to 3% of sales over the medium term, with 85% allocated to growth and savings initiatives, up from 75% in the past five years. HUL also targets fixed-cost growth at 0.8 times revenue growth to enhance operating leverage.

The FMCG giant is pushing to elevate its Dove brand to the second-largest in its portfolio from its current fifth position. Despite near-term stock pressure — HUL shares have fallen 5.28% in a month, 13% in six months, 15% YTD, and 23.31% over the past year — the company maintains confidence in long-term delivery, citing FY27 performance to exceed FY26.

HUL’s CEO Priya Nair noted resilience in the Indian economy amid global volatility, supported by policy measures and stable demand. Over ten years, the stock has delivered multibagger returns of 122.38%, though it is down 26% over five years.