MUMBAI: HUL will initiate price hikes in some of its product portfolio like skin cleansing and tea as FMCG firms grapple with high commodity inflation.
Crude palm oil and tea, which make up a large share of the company’s commodity basket, are seeing high inflation. “In the Dec quarter, you will see calibrated price increases in skin cleansing and tea.Some of them (price actions) have landed in the market, the balance will land over the course of the quarter. After a prolonged period of benign commodity prices, crude palm oil and tea witnessed inflation of 10% and 25% year-on-year respectively,” chief financial officer Ritesh Tiwari said at a post-earnings press briefing here on Wednesday. He added that value growth is expected to be ahead of volume growth in Q3. HUL’s net profit for the Sept quarter on a standalone basis declined to Rs 2,612 crore from Rs 2,717 crore in the year-ago period – a drop of nearly 4%.
Total sales increased to Rs 15,319 crore in Q2, a marginal 1.9% YoY growth as slower consumption in urban markets weighed on overall growth despite a sustained recovery in rural demand.
HUL reported an underlying volume growth of 3% and an underlying sales growth of 2% in Q2.