Feb. 7 (Bloomberg) -- Hindustan Unilever Ltd., a unit of the world’s second-largest consumer-goods maker, had its biggest two-day drop in more than a year after Citigroup Inc. cut the stock’s rating to “sell” citing stronger competition.
The seller of Fair & Lovely lotions, Ponds creams and Knorr soups fell as much as 2.3 percent in Mumbai trading, extending its decline in the past two sessions to 5.8 percent, the most intraday since January 2011. The stock traded down 2 percent at 379.35 rupees as of 11:36 a.m. local time and was the second- biggest loser on the benchmark Sensex.
Sales of Hindustan Unilever’s personal care products grew 14 percent in the quarter ended December 31, the company said in a statement yesterday. That growth was weaker than some analysts had estimated amid a slowing Indian economy.
“With this kind of growth rate, profitability will also be under pressure,” said Naveen Trivedi, an analyst with Infinity.com Financial Securities Ltd. in Mumbai, who said he had expected growth of 18.5 percent in personal care sales. “Overall consumer demand was low in the quarter.”
The Reserve Bank of India in January cut its growth forecast for Asia’s third-largest economy to 7 percent in the year through March from the 7.6 percent predicted in October.
Hindustan’s Unilever’s net income rose 18 percent to 7.54 billion rupees, beating analysts’ estimates.
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