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Buy Hindustan Unilever; target of Rs 3100: Motilal Oswal

Motilal Oswal is bullish on Hindustan Unilever recommended buy rating on the stock with a target price of Rs 3100 in its research report dated January 20, 2023.

January 21, 2023 / 03:57 PM IST
 
 
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Motilal Oswal's research report on Hindustan Unilever

HUVR’s operating performance in 3QFY23 was in line with expectations. PBT and PAT beat our estimates by ~8%, driven by higher-than-expected other income. On the effective 80bp increase in royalty (effective for the next five years) from 2.65% to 3.45%, we are not particularly perturbed if HUVR receives commensurate benefits from the parent. The decision also requires a majority of minority shareholders’ approval and is not a CG risk in our view. Even at 3.45% royalty by CY27, HUVR’s royalty rate will be well below that of NEST/CLGT/PGHH (close to ~5%). While rural recovery and commodity cost declines are taking longer than expected, management believes that the worst is over and HUVR will be a clear beneficiary on both fronts. Maintain Buy.

Outlook

Maintain Buy with a TP of INR3,100 (55x FY25E EPS).

For all recommendations report, click here

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Hindustan Unilever - 20 -01-2023 - moti

Broker Research
first published: Jan 21, 2023 03:57 pm

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