GST cut, lower inflation help HUL Q3 revenues grow 4.3%

MUMBAI: A mix of low food inflation and GST cuts have put more money into the hands of people, aiding demand for consumer goods, FMCG giant Hindustan Unilever (HUL) said on Thursday. It projected FY27 growth to be better than FY26 even as the firm cautioned that input costs remain volatile due to a depreciating rupee and divergent commodity trends.

Helped by favourable macro trends and improved consumer sentiment following months of sluggish growth, HUL’s strategy will be to shore up sales volumes.

“We are obsessed with volume-led revenue growth,” CEO & MD Priya Nair said in a post-earnings briefing here, adding that rural consumption continues to grow ahead of urban. The per capita consumption in rural areas is much lower, leaving room for higher growth, Nair said. “But we see both urban and rural growth to be stable and firm,” she added.

HUL’s revenue from operations increased to Rs 15,805 crore on a standalone basis in the Dec quarter, translating into a year-onyear growth of 4.3%. Net profits jumped to Rs 7,075 crore in Q3FY26 from Rs 3,001 crore in the year-ago period on the back of a oneoff gain arising from the demerger of its ice cream business. Profit after tax befo-re exceptional items from continuing operations for the quarter however, grew by a mere 1% to Rs 2,570 crore due to impact of the labour codes.

In Q3, HUL incurred a one-time gratuity impact due to labour codes amounting to Rs 110 crore, said new CFO Niranjan Gupta. The company delivered a 5% underlying sales growth and a 4% underlying volume growth in the quarter. HUL results, however, failed to cheer the street with the stock price ending at Rs 2,410 apiece on the BSE, down 2.1%.

“Our broad-based growth in the current quarter reflects gradual momentum across our portfolio. Looking ahead, we expect the operating environment to remain conducive for a sustained recovery in consumption,” said Gupta in his first earnings call after assuming office in November.

Consumption gains from GST cuts on a host of essentials which kicked in last Sept will play out in the long term, alongside boosting premiumisation instead of showing up by way of a short-term spike in demand, Gupta said. Under Nair, HUL is doubling down on quick commerce which now accounts for 3% of the firm’s sales, and scaling D2C businesses, betting on emerging growth areas such as health and wellbeing as rise of instant shopping and new age brands change the way India consumes.