More Pain In Store? India's Largest Consumer Goods Maker HUL Warns Of Further Price Hikes

With inflation remaining above the 7% mark for three consecutive months of April, May and June this year, FMCG giant Hindustan Unilever Ltd has warned of further price hikes in India.

After declaring its financial results for the April-June quarter yesterday, India's largest consumer goods maker HUL warned that high inflation will dent its margins in the current quarter (July-Sept) and could result in higher prices of its products, as per Reuters.

High commodity prices have forced the India unit of Unilever to raise prices across its main segments, including household care, skin and hair cleansing products, in the quarter ended June 2022.

Further, Hindustan Unilever expects margins to remain under pressure in the September quarter and growth to be driven by price hikes, the company said yesterday.

ET/agencies

"We will continue to take calibrated price actions, " HUL¡¯s Chief Financial Officer Ritesh Tiwari said on a post-earnings call, adding that if commodity prices taper further, then we should start seeing favourable impact in our books from the December quarter.

India's annual consumer inflation, which touched multi-year highs in the past few months, had eased marginally to 7.01% in June, vs 7.04% in May 2022.

HUL sold products worth Rs 14,016 crore during the April-June quarter, the report mentioned.

Sales of the company's home care products, including brands such as Surf Excel and Vim, reportedly jumped nearly 30% to Rs 4,931 crore, while the beauty and personal care segment grew 17%.

Besides that, HUL's profit rose to a whopping Rs 2,289 crore ($286.36 million) for the three months ended June 30th.

Given that inflation has remained high in the past six months, HUL and other FMCG giants in India, including Nestle, Britannia, Dabur, Parle etc. had earlier warned of price hikes as well.

Previous Rate Hike Announcements This Year

MAI International

In March 2022, HUL and Nestle announced an increase in the prices of products like tea, coffee, milk, and noodles. Soon, other FMCG Giants Like Dabur & Parle expressed that they were contemplating price hikes. In the same month of March, India¡¯s biggest cookie manufacturer Britannia had expressed plans to raise prices by up to 7% this year.

And then next month itself, Maggi maker Nestle had again warned of further price hikes due to rising costs amid inflation.

Nearly a month after that, other FMCG Giants followed Nestle, with HUL, Coca Cola And Britannia Warning Of Further Price Hikes in May 2022.

Also Read: How Pepsi Once Owned The World's Sixth Largest Navy

For the latest and interesting financial news, keep reading Indiatimes Worth. Click here.