Accumulate Hindustan Unilever; target of Rs 2870: Deven Choksey

Deven Choksey's research report on Hindustan Unilever

HUL’s Q1FY26 performance was mixed, as revenue was broadly in line with our estimates; however, EBITDA stood below our estimates (-2.8%) led by elevated operating costs, while net profit stood above our expectations (+5.7%), led by oneoff i.e., lower ETR. Consolidated revenue grew at a moderate pace of 5.1% YoY (+5.4% QoQ) to INR 1,65,140 Mn., in-line with our estimates. The growth was led by underlying volume growth (UVG) of 4.0%, driven by broad-based USG (underlying sales growth) across segments including Beauty and Wellbeing, Personal Care, Foods, and Home Care.

Outlook

We have roll-forwarded our valuation basis to Jun’27 estimates. We value Hindustan Unilever at 55.0x Jun’27 EPS (~to its 3-year Avg. NTM P/E), implying a target price of INR 2,870. We reiterate our “ACCUMULATE” rating on the stock, led by anticipated recovery in gross margin and enhanced competitive intensity through the remainder of FY26E.

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Hindustan Unilever - 02092025 - deven