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Tag: Harish Manwani

  • “We need leaders who have a point of view on future:” HUL’s Harish Manwani

    “We need leaders who have a point of view on future:” HUL’s Harish Manwani

    MUMBAI: At the 82nd Annual General Meeting held at Mumbai today, Hindustan Unilever Limited (HUL) chairman Harish Manwani informed shareholders about the imperative for companies to adopt an inclusive approach to serve and thrive in a country as diverse as India.

     

    He also underlined the need for corporate India to be a part of the solution for the many challenges that lie ahead to reap the rewards of the India opportunity.

     

    HUL – a part of the India growth story

     

    In the speech titled ‘Serving Many Indias’, Manwani spoke about how HUL participated in India’s growth agenda over the years with the firm belief that ‘what is good for India is good for HUL.’

     

    He spoke about how HUL’s growth and evolution has reflected the needs and development of India. He elaborated on how the company took the lead at critical junctures when the country needed the support of businesses to contribute to the national cause, be it its pioneering initiatives towards integrated rural development or manufacturing investments in backward areas as well as its renowned leadership and skills development programmes.

     

    Manwani said, “At HUL, we have a simple model to ensure that we leverage the full opportunity that India presents by serving the many Indias within the country. This is essential for the long term growth of the company and more importantly it also fulfils our commitment to contribute to India’s growth and development in an inclusive and sustainable manner.”

     

    Serving many Indias

     

    Manwani argued that serving many Indias essentially requires having a portfolio of brands that reach out to a wide section and ensures that everyone has access to the brands – rich or poor. “Through our operations, we create a virtuous circle which benefits every geography of India, and we build talent both in terms of leadership as well as skills across the value chain of our operations,” he said.

     

    Speaking about the need to serve diverse consumers, he stated, “Our approach of developing innovations with consumer price as the starting point is at the heart of our inclusive innovation strategy.”

     

    He stressed on HUL’s extensive sales and distribution network which helps the company reach diverse markets in India making its brands available in every single town and most villages in India. HUL, while is leveraging technology to reach out to consumers in the most remote and media dark villages, it is also engaging with the digital media savvy urban youth who are increasingly making their buying decisions online.

     

    Speaking about the recently introduced operating framework ‘Winning in Many Indias’ (WiMi), he said that this was a major organisational transformation that HUL embarked on with the underlying objective of winning in all parts of the business and across channels and geographies.

     

    Under this framework, HUL has segmented the market into 14 consumer clusters that are homogeneous and added a fifth branch in Central India, an underpenetrated but high-potential region.

     

    “This model helps us serve our diverse consumer base in a more differentiated and relevant way across the country,” he said. He also gave the example of how West Bengal enjoyed a higher concentration of consumers of premium beauty products. “This knowledge allows us to differentiate our marketing efforts in each of the regions and meet the needs of our consumers more effectively,” he added.

     

    Serving diverse communities

     

    Manwani further spoke about how HUL’s wide manufacturing base of 30 factories across India has helped create industrial ecosystems and enhance livelihoods in the communities around them. 
     

    “Our wide manufacturing footprint has opened up unique opportunities to reach out to communities and build on our larger purpose, which is to make sustainable living commonplace,” he said.

     

    He spoke about ‘Prabhat’, a community development initiative running across HUL’s manufacturing units, which focuses on promoting health and hygiene, enhancing livelihoods and water conservation in and around HUL factories.

     

    “HUL’s experience of developing the local ecosystems around its manufacturing units, offers a perspective on just how well the ‘Make in India’ agenda can be scaled across the country to make a difference,” he added.

     

    Developing inclusive talent

     

    In his speech, he also addressed the issue about the need for companies to have an inclusive people agenda to be able to successfully serve the many Indias. “Building employable talent is key to securing the long-term socio-economic progress for India. This is an agenda that has to be addressed by the government as well as corporate India. We need to equip the youth with the required skills to enable them to reap the economic benefits of India’s development,” he said. 

     

    Manwani highlighted how HUL was endeavouring to develop skills and capabilities of people across its value chain, from the smallholder farmers to its suppliers, distributors and factory workers. He gave examples of various programmes that the company has taken up for capability building among factory workers.

     

    He cited the example of ‘Stepping into One’ programme that develops technical and leadership skills among shop floor employees, providing them with career advancement opportunities into supervisory roles. “It is initiatives like these that help to drive our efforts to develop talent in an inclusive and sustainable manner,” he added.

     

    He further argued for the need for leaders who have the vision to understand the challenges and leverage the opportunities that a country as diverse and complex as India presents. “We need leaders who have a point of view on the future. We need leaders who can combine the right values and vision to drive inclusive growth so that we not only deliver sustainable growth but also serve the many Indias at the same time,” he said.

     

    Serving India through sustainability

     

    He mentioned about how the low human development index in India was a barrier for socio-economic progress which denied millions of people access to a decent standard of living. “Fundamental to inclusive growth and serving many Indias is providing the basic needs of health, hygiene, nutrition and a clean environment,” he said.

     

    Manwani spoke about how businesses, which work alongside the government to address social and environmental challenges, will thrive in the long term. “It is this belief that led us to launch the ambitious Unilever Sustainable Living Plan (USLP) in 2010 which aims to double the size of our business while decoupling our growth from our environmental impact and increasing our positive social impact. The USLP lies at the heart of our business model and is firmly embedded across every part of the organisation,” he said.

     

    Manwani elaborated on the various social and environmental initiatives that HUL has taken up as a part of USLP and how these were helping address some of the basic challenges that India faces.

     

    Speaking about Lifebuoy’s behaviour change model for handwashing with soap to help prevent child mortality due to diseases like diarrhoea and pneumonia, he said, “We have already helped over 60 million people through our various handwashing programmes. Last year, we entered into a partnership with Children Investment Fund Foundation and the Government of Bihar to promote handwashing behaviour change among children in Bihar. The main aim of the programme is to help prevent childhood illness and mortality. We piloted the programme in two districts of Bihar – Begusarai and Khagaria, reaching out to nearly one million people. We are scaling up this initiative and over the next three years, we expect to reach out to an additional 45 million people,” he concluded. 

  • FY-2015: HUL marketing spends up 7.2%; Q4-2015 marketing spends cross Rs 1000 crore

    FY-2015: HUL marketing spends up 7.2%; Q4-2015 marketing spends cross Rs 1000 crore

    BENGALURU: Indian FMCG giant Hindustan Unilever Limited (HUL) Advertisement and Promotions expense (marketing spends, ASP) in FY-2015 was 7.2 per cent more at Rs 3874.94 crore (12.6 per cent of Total Income from operations or TIO, approximately $590 million) than the Rs 3613.609 crore in FY-2014.

    For the fourth quarter ended 31 March, 2015 (Q4-2015, current quarter), the company exceeded the Rs 1000 crore (approx. $156 million) mark to clock Rs 1027.89 crore (13.4 per cent of TIO, approx. $160 million). ASP in the current quarter was 22.3 per cent more than the Rs 840.34 crore (11.8 per cent of TIO) in the corresponding year ago quarter and was 5.2 per cent more than the Rs 977.12 crore (12.6 per cent of TIO) in Q3-2015.

    Note: (1) 100 lakh = 100,00,000 = 1 crore = 10 million.

    (2) All figures in this report are standalone figures filed by the company. The trends are based on the numbers submitted by the company or picked up from the company’s website. For performance of HUL’s various product lines please refer to the attached earnings release for Q4-2015 and FY-2015.

    (3) The US dollar figures are approximately based on a conversion rate of 1$= Rs 64.The converted numbers have been rounded off.

    HUL chairman Harish Manwani said, “We have delivered another year of strong performance with broad based growth ahead of the market and sustained margin improvement. Our strategy remains focused on strengthening the core of our business through innovation, leading market development and continuous improvement of our executional capabilities. Despite market challenges, our strategic agenda remains unchanged as we continue to manage our business even more dynamically for growth that is consistent, competitive, profitable and responsible.”

    As a matter of fact, HUL’s ASP in Q4-2015 is the highest over a 12 quarter period starting Q1-2013 until the current quarter in terms of absolute rupee spends at Rs 1027.89 crore. In terms of percentage of TIO, during the period under consideration, ASP was 13.8 per cent of TIO in Q2-2014 at Rs 954.02 crore. Please refer to Fig A below.

    HUL’s ASP in absolute rupees shows a linear increasing trend during the 12 quarter period under consideration. The blue broken trend line intercepts Q4-2015 at Rs 995.876 crore, showing that the company has spent Rs 32.014 crore more than indicated by the trend line’s slope.

    HUL’s ASP in terms of percentage of TIO in Q4-2015 at 13.4 per cent is in excess of the 12.6839per cent represented by the slope of the orange broken trend line during the period under consideration.

    HUL TIO in FY-2015 at Rs 30805.62 crore (approx. $4.8 billion) was 9.9 per cent more than the Rs 28019.13 crore in the previous year. In Q4-2015, TIO at Rs 7675.63 crore was 8.2 per cent more than the Rs 7094.10 crore in Q4-2014, but was 1.3 per cent lower than the Rs 7774.32 crore in the immediate trailing quarter. Please refer to Fig B below. The orange broken trend line indicates that TIO has a linear increasing trend during the 12 quarter period under consideration in this report.The slope of the line indicates that HUL should have had a higher TIO of Rs 7856.14 crore and hence underperformed by Rs 180.51 crore (about $28 million).

    HUL PAT in FY-2015 at Rs 4315.26 crore (14 per cent of TIO, approx. $675 million) was 11.6 per cent more than the Rs 3867.49 crore in FY-2014. For Q4-2015, PAT at Rs 1018.08 crore (13.3 per cent of TIO) was 16.7 per cent more than the Rs 873.13 crore (12.3 per cent of TIO) in Q4-2014, but was 18.7 per cent less than the Rs 1252.17 crore(16.1 per cent of TIO) in Q3-2015.

    In Fig B below, the maroon broken line indicates that PAT in absolute rupees shows a linear increasing trend during the period under consideration. The slope of the line indicates that the HUL should had have had a higher PAT of Rs 1131.504 crore in Q4-2015 and hence underperformed by Rs 113.42 million ($18 million)

    In terms of percentage of TIO, the green broken line indicates a linear decreasing trend. The slope of the line indicates that HUL’s actual PAT as percentage of TIO of Q4-2015 at 13.3 per cent is higher than the calculated 13.12 per cent.

    HUL’s board of directors at its meeting held on Monday, 8 May, 2015 recommended a final dividend of Rs 9 per share of Re1 each, for the financial year ended 31 March, 2015. Together with the interimdividend of Rs 6 per share paid on 3 November, 2014, the total dividend for the financial year ended 31 March, 2015 works out to Rs 15 per share of Re 1 each. Final dividend, subject to approval of shareholders, will be paid on or after Friday, 3 July, 2015.

  • HUL to drive competitiveness of its brands

    HUL to drive competitiveness of its brands

    KOLKATA: Consumer goods major Hindustan Unilever Ltd (HUL) is looking at strengthening the core of its business and drive competitiveness of its brands in the market.

     

    “We continue to strengthen the core of our business and drive the competitiveness of our brands in the market. At the same time, we are leading market development in relatively nascent categories such as packaged foods and premium personal care with strong results,” said HUL chairman Harish Manwani.

     

    Talking about the packaged food segment, Kolkata-based Microsec Research said, “It was the fifth successive quarter of double digit growth in packaged foods segment, led by Kissan and Kwality Walls.”

     

    On brand investments, Manwani added: “Brand investments were sustained at competitive levels across all segments even as competitive intensity stepped up in the commodity linked categories.”

     

    It should be noted that from food and beverages to personal care, HUL’s brands are part of everyday life. “Our brands play a major part in helping us achieve our sustainable living aims of helping more than a billion people improve their health and well-being; halving the environmental footprint of our products and sourcing 100 per cent of our agricultural raw materials sustainably. Given the fast changing external environment, we are managing our business dynamically for sustained volume led growth and margin improvement,” the company said.

     

    From last two quarters, input costs were benign with a fall in crude oil prices and this has started to reflect in the lower cost of goods sold, the company further said.

     

    To pass on the benefits of reduced inputs costs, the FMCG major has reduced the prices of soaps and detergents, which accounted for around 50 per cent of its revenues in the last quarter.

     

    When a city based analyst was called, he said in the current quarter one can expect price cut in skin cleansing products and tea and other verticals, which did not see any price correction.

     

    Since price cuts are expected to take place in premium brands as well apart from mass brands, as the company hinted, HUL is aiming see consumers upgrading themselves, the analyst said.

     

    As per Microsec Research, Pureit delivered another good quarter of double digit growth led by the premium segment.

  • Q3-2015: HUL marketing spends up 5 per cent at Rs 977 crore

    Q3-2015: HUL marketing spends up 5 per cent at Rs 977 crore

    BENGALURU: Indian FMCG giant Hindustan Unilever Limited’s (HUL) Advertisement and Promotions expense (ASP) in Q3-2015 at Rs 977.12 crore (12.6 per cent of Total Income from operations or TIO) was 5.1 per cent more than the Rs 929.46 crore (12.9 per cent of TIO) in the corresponding quarter of last year and 5.6 per cent more than the Rs 925.05 crore (12.1per cent of TIO) in Q2-2015.

    During the nine month period ended 31 December 2014 (9M-2015) the company’s ASP at Rs 2807.05 crore (13.3 per cent of TIO) was 2.7 per cent more than the Rs 2773.26 crore (12.5 per cent of TIO) during 9M-2014.

    Note: (1) 100 lakh = 100,00,000 = 1 crore = 10 million.

    (2) All figures in this report are standalone figures filed by the company.

    The company reported a 7.6 per cent y-o-y jump in TIO in Q3-2015 to Rs 7774.32 crore from Rs 7223.35 crore in Q3-2014 and just a meagre 1.8 per cent increase from the Rs 7639.33 crore in Q2-2015. YTD, HUL’s TIO at Rs 23129.98 crore was 10.5 per cent more than the Rs 20925.03 crore in 9M-2014.

    Fig A below shows the ASP trend of the company over an eleven quarter period starting Q1-2013 until the current quarter Q3-2015. In terms of absolute rupees, ASP shows an upward linear trend with the current quarter’s ASP being the highest. ASP in Q2-2013 (Quarter ended 30 September 2012) at Rs 768.98 crore (12.2 per cent of TIO).  ASP in terms of per centage of TIO was highest in Q2-2014 at 13.8 per cent (Rs 954.02 crore), while the lowest ASP in terms of per centage of TIO was in Q4-2014 at 11.8 per cent (Rs 944.88 crore). The company’s ASP in terms of per centage of TIO shows a declining trend.

    Fig B below indicates HUL’s TIO and PAT trends during the above mentioned eleven quarter period. The company’s TIO shows an upward linear trend with the current quarter’s TIO highest and TIO during Q2-2013 being the lowest at Rs 6318.81 crore. During the period under consideration, TIO in Q1-2015 registered the highest q-o-q growth at 8.8 per cent to Rs 7716.34 crore from Rs 7094.10 crore in Q4-2014. TIO in Q4-2014 registered the sharpest drop at 1.8 per cent from Rs 7223.35 crore in Q3-2014 during the same eleven quarter period.

    HUL recorded an increase of 17.9 per cent in PAT to Rs 1252.17 crore (16.1 per cent of TIO) in Q3-2015 from Rs 1062.31 crore (13.3 per cent of TIO) in Q3-2014 and a 26.7 per cent increase from Rs 988.16 crore (12.9 per cent of TIO) in Q2-2015. During 9M-2015, PAT grew 10.1 per cent to Rs 3297.17 crore (14.3 per cent of TIO) from Rs 2995.36 in 9M-2014. In terms of per centage of TIO,  as well as in absolute rupees, HUL’s PAT was highest in Q1-2013 at 20.9 per cent and Rs 1331.19 crore. While PAT shows a slight linear decline in absolute rupees during the period under consideration, in terms of per centage of TIO, the linear decline is more marked.

    Kotak Securities FMCG analyst Ritwik Rai said, “HUL’s Q3-2015 results disappointed as volume growth (3 per cent, y-o-y) missed our estimates (5 per cent estimate). The company has reported that its volume and value growth remains ahead of the sector. Gross margins expanded in line with expectations. Excluding one-time provisions in employee expenses, the reported EBITDA came in 5 per cent below our estimates. We would expect that sales growth of the company shall pick up in the coming quarters, as lower inflation, improved sentiment help lift volume growth. Benefits of lower commodity prices are visible in the quarter, and will continue to be a useful tailwind for the company. The stock could see some near-term pressure, given sharp run-up in recent sessions and disappointing Q3-2015 results. However, our medium-term view on the stock remains constructive.”

    HUL chairman Harish Manwani added, “We have delivered another quarter of competitive growth and margin improvement. We continue to strengthen the core of our business and drive the competitiveness of our brands in the market. At the same time, we are leading market development in relatively nascent categories such as packaged foods  and premium personal care with strong results. Given the fast changing external environment, we are managing our business dynamically for sustained volume led growth and margin improvement.”

  • HUL gets a new independent director in Kalpana Morparia

    HUL gets a new independent director in Kalpana Morparia

    MUMBAI: Hindustan Unilever Limited (HUL) has got a new independent director. JP Morgan India CEO Kalpana Morparia has been brought on its board effective 9 October 2014. She is also a member of the JP Morgan Asia Pacific Management Committee.

     

    Morparia is an Independent director on the boards of several companies including Dr. Reddy’s Laboratories Limited, Bennett Coleman & Company Limited, Phillip Morris International and CMC.  

     
    Prior to joining JP Morgan India, Morparia served as vice chairman on the boards of ICICI Group companies.  She was the joint managing director of the ICICI Group from 2001 to 2007.

     
    Morparia will be a member of the Audit and Corporate Social Responsibility Committees of the HUL Board.

     
    HUL chairman Harish Manwani said: “Kalpana’s vast experience and proven track record of leadership will add tremendous value to our Board.”

         
    Morparia stated: “I am delighted to join the Board of this iconic Company. I look forward to my role as an Independent Director of one of the most respected consumer companies.”

     

  • Harish Manwani to retire as HUL’s chief operating officer

    Harish Manwani to retire as HUL’s chief operating officer

    MUMBAI: After 38 years of service, Harish Manwani, Unilevers’ chief operating officer has decided to hang his boots.

     

    Manwani will retire from Unilever on 31 December 31; however, he will continue in his capacity as the non-executive chairman of Hindustan Unilever Limited (HUL).

     

    Manwani, who had joined HUL as a management trainee in 1976, grew the personal products business from a nascent business to one of the key growth engines of the company. Subsequently,  he enjoyed success in many roles, covering both categories and markets, and across many parts of the world. This included stints as SVP Global Hair Care & Oral Care and Home & Personal Care president first of Latin America and later of North America.

     

    Unilever CEO Paul Polman said, “Harish is an inspirational leader and leaves a remarkable legacy. He has been at my side in helping to drive the turnaround of Unilever, making this once again one of the most admired companies in the world. Over the last three years, especially as Chief Operating Officer, Harish has been instrumental in the transformation of the company. Under his leadership we have seen a step-change in our go-to-market organisation and there has been a relentless focus on flawless execution globally.  He has role-modelled the 4G sustainable growth model – Competitive, Consistent, Profitable and Responsible – which has become such a strong focal point for the Markets.”

     

    Paul added, “I would like to thank Harish once more for his enormous contribution.  He is both a friend and a much admired and respected business leader. In everything he has done, Harish has lived the values that make Unilever such a great company. Through his passion, commitment and endless energy, he leaves a lasting impact on the business he has served with such distinction. I will personally miss his friendship and wise counsel.”

     

    As COO, Manwani’s key achievement have been his leadership of the global markets where he established and aligned the market clusters across the world behind a clear agenda, creating a better and more integrated go-to-market organisation. It has also allowed the business to be managed more dynamically, resource allocation to be done more efficiently across markets and best practices to be transferred more seamlessly. This has allowed Unilever to become increasingly more competitive in a tougher business environment.

     

    Manwani  said, “I am deeply grateful to all those colleagues who have helped to make the last 38 years at HUL and Unilever so memorable and fulfilling. It has been a privilege to serve such a great company. Today, Unilever is in a strong position with a clear strategy and capabilities to drive long-term responsible growth. This makes it a good time for me to make this personal transition. I look forward to working with Paul and the leadership team over the coming months to ensure a smooth transition and to further build our growth agenda.”

     

  • HUL’s Paranjpe to move up, Sanjiv Mehta is the new CEO

    HUL’s Paranjpe to move up, Sanjiv Mehta is the new CEO

    MUMBAI: The Rs 25,000 crore FMCG major Hindustan Unilever has elevated its managing director and CEO Nitin Paranjpe as the global head of parent company Unilever‘s home care business.

    HUL MD and CEO Nitin Paranjpe

    From 1 October, company‘s current Middle-East and North Africa operation head Sanjiv Mehta will replace Paranjpe as HUL MD. Mehta will also be responsible for south Asia cluster which includes India, Pakistan, Sri Lanka, Bangladesh and Nepal. However, the appointment of Mehta will be subject to approval of shareholders.

    Paranjpe will join the leadership executive team and will report directly to global CEO Paul Polman.

    Announcing the management changes, HUL chairman Harish Manwani said “The changes reflect our strong commitment towards leadership development and our tradition of leveraging experiences and synergies of talent across markets.”

    HUL chairman Harish Manwani

    Welcoming Mehta as the new CEO, Manwani added, “Sanjiv brings with him rich experience of successfully leading businesses across developing and emerging markets. I am confident that he will further build on the growth momentum and drive the company‘s agenda of competitive, consistent, profitable and responsible growth.”

    HUL, which employs over 16,000 people in India, markets various brands including Lux, Lifebuoy, Surf Excel and Pepsodent. They contribute six-seven per cent to Unilever‘s turnover which recently pumped Rs 19,180 crore through an open offer to increase its stake to 67 per cent in the company.

  • HUL ups ad spend by 21.27% in Q4 FY13

    MUMBAI: Fast moving consumer goods major Hindustan Unilever Ltd (HUL) increased its spending on advertising and promotions for the fifth consecutive quarter ended 31 March as competitive intensity in the category continued to be high.

    The FMCG giant ramped up its spending into the fourth quarter of FY13 with ad spends increased by a robust 21.27 per cent in Q4 FY13 when compared to Q4 FY12.

    HUL‘s advertising and marketing expenditure in the fourth quarter of FY12 stood at Rs 6.77 billion which grew to Rs 8.21 billion in the fourth quarter of FY13 ended 31 March 2013. The percentage of total income dedicated to advertising also grew from 11.74 per cent in Q4 FY12 to 12.70 in Q4 FY13.

    The company‘s income for the period grew by 12.14 per cent on a year on year basis from Rs 57.66 billion in Q4 FY12 to Rs 64.66 billion in Q4 FY13. Its net profit grew by 14.56 per cent as the net profit in Q4 FY12 was Rs 6.87 billion compared to Rs 7.87 billion in Q4 FY13.

    HUL said, “The operating context remained challenging during the fourth quarter with input costs holding firm and high competitive intensity. Advertising and promotion was stepped up and maintained at competitive levels.”

    HUL chairman Harish Manwani said, “In an environment that continued to be challenging, we have delivered another quarter of broad-based growth and margin expansion.”

    This quarter saw quite a few ad campaigns do well for the FMCG major, these included Dove‘s rescue from split ends; Sunsilks‘ perfect straight hair and Lux‘s deo spray magic spell. HUL gained by these campaigns as it reflects in the annual results declared by the FMCG major.

    The annual figures reflect a growth from FY12, as the FMCG company increased its advertising spends by a hearty 21.99 per cent in FY13. HUL‘s advertising and marketing outflows increased from Rs 26.97 billion (FY12) to Rs 32.90 billion (FY13).

    The total income from advertising also grew from 11.51 per cent in FY12 to a healthy 12.18 per cent in FY13. The FMCG‘s income for the period also grew by 15.22 per cent on a annual basis from Rs 234.36 billion in FY12 to Rs 270.03 billion in FY13. And the new profit grew by a stellar 37.12 per cent, seeing it rise from Rs 27.91 billion in FY12 to Rs 38.29 billion in FY13.

  • HUL increases ad spend by 19% in Q3

    MUMBAI: FMCG major Hindustan Unilever Ltd (HUL) increased its spending on advertising and promotions for the fourth consecutive quarter ended 31 December as competitive intensity continued to be high.

    HUL‘s spending on advertising in the quarter ended 31 December, the third quarter of financial year 2012-13, rose 19 per cent to Rs 8.22 billion from Rs 6.90 billion a year earlier.

    The increase in ad spend by HUL has served as a relief to television broadcasters in a year of slowdown. Incidentally, HUL is the largest ad spender in the country.

    Broadcasters have looked at FMCG companies to rescue them from a slowdown in their ad revenues this fiscal as certain high-spending categories like financial services have pulled back spends. While certain broadcasters have admitted that ad revenue growth in the first two quarters have been muted, the third quarter has been particularly good.

    For the nine months ended 31 December, HUL‘s advertising spend increased by 22 per cent to Rs 24.10 billion from Rs 19.74 billion a year earlier.

    HUL said, “The operating context remained challenging during the third quarter with input costs holding firm and high competitive intensity. Advertising and promotion was stepped up and maintained at competitive levels.”

    The company increased its spend on advertising for the first time in the fourth quarter of 2011-12 after a slowing economy dented ad spends for a few quarters. In the quarter ended 31 March 2012, its advertising spends were Rs 6.77 billion, up 8.67 per cent from a year earlier.

    For the whole of 2011-12, HUL‘s advertising spends was down 3.58 per cent to Rs 26.97 billion from Rs 27.97 billion a year earlier.

    During the third quarter of 2012-13, the domestic consumer business of HUL grew by 15 per cent with the underlying volume growth of 5 per cent. Both its home and personal care (HPC) and food & beverages (F&B) businesses registered double digit growth.

    HUL said despite intense competition, its net profit increased 16 per cent to Rs 8.71 billion in the quarter ended 31 December from Rs 7.25 billion a year earlier.

    HUL chairman Harish Manwani said, “In an environment that continued to be challenging, we have delivered another quarter of broad-based growth and margin expansion.”

  • HUL’s promotional spends drop 3.58% to Rs 26.97 bn in FY’12

    MUMBAI: Fast moving consumer goods (FMCG) major Hindustan Unilever (HUL) has reduced its spend on advertising and promotions by 3.58 per cent in the fiscal ended 31 March 2012 compared to the year-ago period.

    The company spent Rs 26.97 billion on promotions, down from Rs 27.97 billion.

    Despite the fall in marketing spends, the company has reported a 16.99 per cent increase in its net sales year on year which stood at Rs 229.88 billion for the fiscal as against Rs 196.48 billion in the prior year.

    HUL’s consolidated net profit was up 21.54 per cent to Rs 27.91 billion compared to Rs 22.96 billion in 2010-11.

    Meanwhile, for the quarter ended 31 March 2012 (standalone), the ad and promotional expenses of HUL spurted 8.67 per cent. The company spent Rs 6.77 billion in the final quarter, up from Rs 6.23 billion a year ago.

    The company’s net sales grew 20.6 per cent to Rs 56.60 billion, in comparison to Rs 46.94 billion. Correspondingly the net profit for the quarter under review also saw an increase of 20.63 per cent to Rs 6.87 billion.

    HUL chairman Harish Manwani said, “Our performance through the year has been consistent, with broad based growth ahead of the market, driven by a relentless focus on innovation and in-market execution. In a year of competitive intensity and high volatility, a sharp focus on cost management helped the business to continue to invest behind our brands and capabilities while delivering an improvement in margins.”

    During the quarter domestic consumer business grew at 20 per cent with strong underlying volume growth of 10 per cent. Soaps and detergents grew 28 per cent as momentum was sustained in both bars and powders with Rin benefiting from the bars being relaunched in the third quarter of 2011. The focus on driving upgradation stepped up growth rates in Surf. During the quarter, Rin made a foray into the fabric blues segment with the launch of Rin Perfect Shine. Household Care delivered robust double-digit growth led by Vim and Domex.

    The personal care category grew at 17 per cent and was strongly volume led in the process. Skin cleansing registered double-digit growth across all price segments. Lux accelerated its momentum, delivering the third successive quarter of double-digit growth post its relaunch. Lifebuoy Clini-care 10 was launched with the breakthrough ‘Activ Naturol Shield’ technology to further strengthen its germ protection superiority in the hygiene segment.

    In skin care Fair & Lovely (FAL), Ponds and Vaseline continued to grow in double digits. FAL growth was broad-based with the FAL Menz variant more than doubling during the quarter. Vaseline grew on the back of a robust performance in lotions and Ponds performed well at the premium end. Innovations in the quarter were led by the relaunch of Ponds Age Miracle, FAL anti-Marks, FAL Under Eye Serum and Vaseline Menz.

    In Hair Care, Dove, Sunsilk and Clear delivered double-digit growth. Dove sustained its growth momentum and volumes doubled in the quarter. Conditioners continued to lead market development with growth in high double digits.

    Oral Care registered modest growth in a competitive environment. Pepsodent GumCare performed well gaining from stepped up investments and distribution expansion.

    Packaged Foods grew 10 per cent, buoyed by Kissan and Kwality Walls Kissan. The Knorr franchise was expanded with the introduction of a new Chicken variant and multi-packs in Soupy Noodles. Kwality Walls continued its strong growth momentum, led by innovations and distribution expansion.