HUL Stock Information

History of HUL:

In India, the HUL was established in the year 1933, but its history date back to 1888 when it began supplying to India. In 1935, it set up United Traders Limited, in 1933 Lever Brothers and 1931, it had set up Hindustan Vanaspati Manufacturing Company. The three joined to form HUL in 1956, and since then the company has moved from strength to strength. The HUL has produced some of the most iconic global brands in the personal care and FMCG markets, like Brooke Bond, Lipton Tea as well as soap brands like Lux, Lifebuoy, and Pears. The company introduced both personal care as well as consumer goods in the market, with the famous Dalda ghee in 1937.

With the arrival of the LPG regime, the Indian markets were opened to global players, as a result of which HUL started seeking the opportunity of positioning itself in the market. In 1996, it had entered into a 50:50 partnership with Lakme and established Lakme Unilever Limited, through which it has tapped into the vast cosmetics segment. A series of acquisitions began when HUL began a slew of product launches into Ayurveda with the Ayush brand of products. In 2009, the company was also looking at sustainability and launched the Compass, with an objective to decrease its carbon footprint while expanding business globally.

Company Information:

HUL is one of the leading FMCG companies in India. With its presence in over 20 segments, the company is a prominent leader in the market of consumer products, though it has witnessed a slight shift of its market share due to the rise of home-grown competitors such as Patanjali.

Company's Wealth and Recent Performance:

HUL had announced results for third quarter ending December 2017, with EBITDA at Rs.1,236 crore and a 28% rise in profit over the period in question. The company has reported a 20% rise in sales of the home care segment, increased by sales of detergent. The personal care segment also saw a 17% growth along with the higher sale volumes in the skin care and cosmetics. The growth in sales across the Kissan brand boosted the food segment to 18%, while the company also saw increased sales in the soups vertical.

The reduction in the GST (Goods and Services Tax) on some FMCG categories, led to a reduction in the price of goods making the liability of Rs.119 crore on the company. The company announced the third quarter results with PBT of Rs.1,685 crore. During the period, the company grew steadily as compared to its peers in the sector.

The introduction of a new range of air purifiers also led to a growth in overall sales and profits. In the refreshments, the increase in the sales segment was evidenced by double-digit growth regarding tea, and the frozen dessert market also saw a jump in sales.

Should I Invest in HUL?

The HUL is listed on both the major stock indices in the country, the BSE and NSE. The company is also listed on many other market indices such as the Nifty 50, Nifty MNC, S&P BSE 100 among a host of others. The stock prices of HUL has progressively increased over the past few years, followed by the constant rise in market share in spite of new competition. The ability of the company to grow and expand market share are the key reasons behind its stable stock price. The company's revenue has also seen a healthy increase, with growth in most segments in double digits.

While new players are continually growing in the personal care sector, HUL's market share has also not affected too profoundly. In a few verticals, there are minor erosions in the company's footprint, but there has been an exponential growth in the food and refreshment segment too, where HUL is the leader in the market. The recent product launches and acquisitions of the company have enabled it to gain a broader foothold in urban markets, with the Ayurvedic "Ayush" range of products being the most significant. The company is projected to continue at a steady pace of growth if it keeps up with the pace of innovation and quality it has maintained thus far. While the company has been performing well in comparison to other players in the market, it is advisable to do additional research and analysis before purchasing stock in the company.

Stocks or Mutual Funds: Here is our recommendation

A lot of research and knowledge is required in stock market investments, and generally, they don't offer any tax benefits. Hence at mymoneykarma, we merely motivate our readers to invest in mutual funds. Investing in mutual funds doesn't require a lot of knowledge, and equity-linked mutual fund schemes also provide tax benefits. In addition to it, since mutual funds contain stocks from multiple companies, they help in building a diversified portfolio.

Note: The contents of this post/blog do not constitute any professional advice on a specific financial matter.

Indexes and Exchages

Bombay Stock Exchange (BSE)

The Bombay Stock Exchange, popularly called BSE, is Asia's first and oldest stock exchange. Located at Dalal Street in Mumbai, the BSE was formally established in 1875 by an influential stockbroker and businessman called Premchand Roychand. In the initial days, the BSE had its meetings under several Banyan trees in Mumbai before finding a permanent place, which is very appropriately named Dalal Street or Broker Street. After functioning as a floor trading exchange for more than a century, BSE ascended the digital ladder in 1995 by implementing a new screen-based automated trading platform with a capacity of 8 million orders in a day. In 2012, the BSE went global by becoming a Partner Exchange of the United Nations Sustainable Stock Exchange. Subsequently, BSE established India's first international exchange, called INX, in 2016.

National Stock Exchange (NSE)

NSE was set up in 1992 by a group of leading Indian financial institutions, following the Indian Government's directives. It aimed to bring transparency to the Indian capital market. It was India's first demutualized electronic exchange which operated on a completely automated screen-based electronic trading system, offering an easy trading facility to all Indian investors. NSE began its operations in the Wholesale Debt Market segment in 1994. NSE was the first company in India to offer a digital platform that connected the investor base of the entire country. NSE offers services in various segments, such as trading, equity derivatives, clearing and settlement services in equity, debt and currency derivatives, etc.

NIFTY Index

The NIFTY is NSE's flagship index that tracks the behavior of a portfolio of blue-chip companies that have the largest and most liquid Indian securities. It is owned as well as managed by IISL (India Index Services and Products Ltd), which is India's first specialized company to focus on an index as a core product. Nifty indexes 50 of the 1600 companies on the National Stock Exchange (NSE) and is thus popularly referred to as 'Nifty 50'. It captures approximately 65% of its float-adjusted market capitalization and is a true reflection of the Indian stock market. The Nifty 50 includes the major sectors of the Indian economy. It offers the exposure to the Indian market in one efficient portfolio. The Nifty index has been trading since April 1996. It is ideally suited for index funds, benchmarking and index-based derivatives.

SENSEX Index

Sensex is BSE's stock market index. It consists of 30 well-established and financially flourishing companies listed on BSE. It was established in 1986. These 30 component companies are known for being the largest and most actively traded stocks. They represent various industrial sectors of the Indian economy. Sensex is also known as BSE 30 and S&P BSE SENSEX. The word 'Sensex' is a portmanteau of the words 'Sensitive' and 'Index.' SENSEX is widely reported in domestic and international markets through print and electronic media. The indexing system is scientifically designed, based on globally accepted construction and review methodology. Since September 2003, S&P BSE Sensex is being determined on a free-float market capitalization methodology.