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Anand Rathi
HUL (Buy)
CMP: ₹1,808.25
Target: ₹2,250
In its latest quarterly results, the company has reported a growth of 11.1 per cent at ₹92,340 million as against ₹83,090 million in same quarter previous year.
The volume growth for the quarter stood healthy at 10 per cent with better growth in rural market on back of improved demand. All the key business segments of the company has reported early double digits growth in the quarter.
The operating margins for the company stood 21.9 per cent at ₹20,190 in Q2-FY19 as against 20.2 per cent at ₹16,820 in Q2-FY18, an improvement of about 160 basis points. The profit after tax margins for the company stood at 16.5 per cent in the quarter as against 15.4 per cent in same quarter previous year. The improvement in margins are due to cost savings program undertaken by the company.
Over the medium term, HUL’s existing strategy and positioning through various of its programme such as WiMI, premiumise and up trade opportunity in various of its product categories seems to be paying off well and is also expected to deliver favourable returns in future.
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