Hindustan Unilever Net Beats Estimates on Soap, Detergent Sales
February 06, 2012, 6:16 PM ESTBy Malavika Sharma
Feb. 6 (Bloomberg) -- Hindustan Unilever Ltd., the Indian unit of Unilever, reported third-quarter profit that exceeded analyst estimates as it sold more soaps and detergents.
Net income rose 18 percent to 7.54 billion rupees ($154.4 million) in the three months ended Dec. 31, from 6.38 billion rupees a year earlier, the Mumbai-based company said in a statement to the stock exchange today. That compares with the 6.96 billion-rupee median of 31 analysts’ estimates compiled by Bloomberg.
The maker of Dove shampoo and Surf detergent has benefited as rising incomes in the world’s second-most populous nation spurred people to spend on personal-care products and pre- packaged food. Sales of its soaps and detergents grew 21 percent, while personal-care product sales increased by 14 percent, the company said in the statement.
“Rural demand for the last two years to three years has kept the momentum strong,” Jagannadham Thunuguntla, strategist at SMC Global Securities Ltd. in New Delhi said in a telephone interview. Government programs “have ensured sufficient money in the hands of the rural people, translating into the decent demand and growth for Hindustan Unilever,” he said.
Sales for the maker of Knorr soups and Lux soaps grew to 58.5 billion rupees from 50.3 billion rupees a year earlier. That compares with the 58.75 billion-rupee median of 32 analysts’ estimates compiled by Bloomberg.
Consumer confidence in India was the highest among 56 countries surveyed by Nielsen in the third quarter of 2011.
Sales of consumer products such as soaps, detergents and shampoos in small towns with a population of less than 1 million people are expected to grow to $80 billion in 2026 from about $6 billion in 2010, Nielsen said in December. The 400 small towns consumed so-called fast moving consumer products worth about $6 billion out of the total $28 billion across the country, it said in a study.
--Editors: Anjali Cordeiro, Subramaniam Sharma
To contact the reporter on this story: Malavika Sharma in New Delhi at msharma52@bloomberg.net.
To contact the editor responsible for this story: Stephanie Wong at swong139@bloomberg.net
