ICICI Securities Sees More Upside In This Multibagger FMCG Stock, Gives Buy Call

Leading brokerage firm ICICI Securities has given buy call to the FMCG stock Hindustan Unilever Ltd for a target price of Rs 2750 apiece with a potential gain of 6%. HUL continues to drive market development-led penetration gains while Health Food Drinks (HFD) category continues to be impacted due to external reasons.

Hindustan Unilever Ltd Stock Outlook

The current market price of the stock is Rs 2588 apiece with a gain of 0.46% in Friday's trading. According to ICICI Securities, if you buy the stock of Hindustan Unilever at the current market price, it has the potential to surge to the levels of Rs 2750 apiece with a potential return of 6%.

Hindustan Unilever Ltd 52-Week High/Low

The stock's 52-week high is Rs 2859 apiece and 52-week low is Rs 1901 apiece, respectively.

Hindustan Unilever Ltd Market Capitalization

The company has a market capitalization of Rs 6,08,074.22 crore.

Significant opportunity of upgradation and market development

For example, in terms of volume, ~60-70% and ~40-50% of laundry and tea category are at the mass/popular end. A lot of upgradation opportunity still exists in these categories from mass to branded and then to premium products. Strategy to upgrade consumers is to drive premiumisation on one side to drive better margins and simultaneously provide the right price-value equation on the mass product to drive upgradation.

Market share gains in all 3 divisions, price segments and geographies

HUL has had the highest YoY market share gains in FY22 over last decade. Market share gains is in all 3 divisions, and geographies as well. Market shares gains were across mass and premium price segments.

Valuation and risks

According to ICICI Securities, "Our earnings estimates are unchanged; modelling revenue / EBITDA / PAT CAGR of 12 / 13 / 13 (%) over FY22-24E. Maintain ADD rating with a DCF-based unchanged target price of Rs2,750. Key downside risks are delayed recovery in demand, sustained raw material inflation and irrational competition. "

Hindustan Unilever Ltd About

With nearly 90 years of heritage in India, Hindustan Unilever Limited (HUL) is India's largest fast-moving consumer goods company. On any given day, nine out of ten Indian households use one or more of HUL's brands, giving us a unique opportunity to build a brighter future. We are known for our great brands, the positive social impact we create and our belief in doing business the right way.

Disclaimer

The stock has been picked from the brokerage report of ICICI Securities. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.