HUL Q3 Results Review - Operating Performance Inline, Royalty Increase Not A Concern: Motilal Oswal

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Motilal Oswal Report.Hindustan Unilever Ltd.’s operating performance in Q3 FY23 was inline with expectations. Profit before tax and profit after tax beat our estimates by ~8%, driven by higher-than-expected other income.On the effective 80 basis points increase in royalty (effective for the next five years) from 2.65% to 3.45%, we are not particularly perturbed if HUL receives commensurate benefits from the parent. The decision also requires a majority of minority shareholders’ approval and is not a CG risk in our view. Even at 3.45% royalty by CY27, HUL’s royalty rate will be well below that of Nestle India Ltd./Colgate Palmolive India Ltd. /Procter and Gamble Hygiene and Healthcare Ltd. (close to ~5%). While rural recovery and commodity cost declines are taking longer than expected, management believes that the worst is over and HUL will be a clear beneficiary on both fronts..Click on the attachment to read the full report:.HUL Q3 Review - Surprise Royalty Increase To Offset The Tailwinds From Positive Mgmt Commentary: Systematix.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

HUL Q3 Results Review - Operating Performance Inline, Royalty Increase Not A Concern: Motilal Oswal

HUL Q3 Results Review - Operating Performance Inline, Royalty Increase Not A Concern: Motilal Oswal

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