HUL Q3 Results FY26: PAT Falls 30% to Rs 2,118 Crore; Revenue Grows 6%
FMCG major Hindustan Unilever Ltd (HUL) reported a mixed set of numbers for the third quarter of FY26, with profitability from continuing operations under pressure even as revenue growth remained steady.
The company posted a 30% year-on-year (YoY) decline in consolidated net profit from continuing operations at Rs 2,118 crore, compared to Rs 3,027 crore in the corresponding quarter last year.
However, overall profit for the quarter surged 121% YoY to Rs 6,603 crore, largely supported by one-time gains arising from portfolio transformation initiatives.
Revenue and Operating Performance
HUL’s revenue from continuing operations stood at Rs 16,441 crore, marking a 5.6% increase from Rs 15,556 crore in the same period last year. The growth was primarily volume-led, reflecting improving consumer demand across categories.
Earnings before interest, tax, depreciation and amortisation (EBITDA) from continuing operations rose 3% YoY to Rs 3,788 crore. However, the EBITDA margin declined by 70 basis points to 23.3%, indicating some cost pressures. (One basis point equals 0.01%).
For the quarter, the company reported:
- Underlying Sales Growth (USG): 5%
- Underlying Volume Growth (UVG): 4%
The performance suggests gradual improvement in consumption trends, driven mainly by higher volumes rather than pricing.
Segment-Wise Performance
Home Care
The Home Care segment strengthened its market leadership and delivered 3% USG, supported by mid-single-digit volume growth. Pricing actions taken earlier continued to weigh on overall pricing, creating a negative price impact.
Beauty & Wellbeing
This segment posted 6% USG with low-single-digit volume growth. Hair Care remained a key growth driver, clocking double-digit volume expansion. Premium brands such as Dove and TRESemmé contributed significantly to performance.
Personal Care
Personal Care recorded 6% growth, led by double-digit expansion in premium Skin Cleansing and Oral Care. Brands like Pears and Dove supported mid-single-digit growth in Skin Cleansing, while the Bodywash portfolio continued to gain market share.
Foods
The Foods portfolio delivered 6% USG, backed by high-single-digit volume growth. Tea volumes grew in mid-single digits, but revenue growth remained muted due to price reductions amid a deflationary commodity environment. Coffee maintained strong double-digit growth, supported by both pricing and volume expansion.
Management Commentary and Outlook
The company highlighted early signs of demand recovery, supported by stable macroeconomic conditions and favourable policy measures. Management expects FY27 to outperform FY26, driven by ongoing portfolio optimisation and channel transformation initiatives.
HUL is also focusing on strengthening emerging distribution channels, including quick commerce, while investing in premium and high-growth categories to enhance brand desirability.
Brokerage View and Stock Reaction
Following the Q3 results, a leading global brokerage maintained a Buy rating on the stock with a 12-month target price of Rs 2,800. The valuation is pegged at 55x Q5–Q8 EPS, broadly in line with the company’s five-year average price-to-earnings multiple.
Despite steady revenue growth, the stock reacted negatively to margin pressures and profit decline. Shares of HUL traded 3% lower at Rs 2,396 after the earnings announcement.
Key Takeaways for Investors
- Revenue growth remains stable at 5.6% YoY
- Volume-led growth indicates improving consumption trends
- Margins under pressure with 70 bps contraction
- One-off gains boosted overall reported profit
- Management optimistic about stronger FY27 performance
Retail investors should closely monitor margin trajectory, commodity price trends, and demand recovery momentum in the coming quarters to assess sustainable earnings growth.
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