NEW DELHI: FMCG bellwether Hindustan Unilever Limited (HUL) has resorted to price cuts across some of its product portfolios to pass on the benefit of softening input costs, amid a slowing economy to drive volume growth.
"Given that the commodity prices are expected to remain benign for certain time period, we have taken price reductions in range of 4-6 per cent in Lux and Lifebuoy portfolio while it may be higher on certain packs in order to pass on the benefits to the consumers," said a company spokesperson had said earlier. A couple of distributors, told Express, the company has lowered prices in the range of 10-12 per cent in home and personal care category.
During the post-results analysts call, the company management had called out the possibility of reducing prices. "We are making certain decisive interventions, whether it is on products, whether it’s on proposition, whether it’s on price. So when we have looked at all of those levers, we have taken a view of what is the outlook for the commodity. We have taken the potential on cost, which is coming from what has happened to the budget. Factoring all of those into account, we are still in a position to actually take down the pricing, give the right value equation to the consumer and drive growth into this," Sanjiv Mehta, chairman, CEO and MD, HUL, had said.
HUL had reported its lowest volume growth in seven quarters during the April-June quarter on the back of slowing consumer demand. HUL saw five per cent volume growth as against 12 per cent in the year-ago period. This was the second straight quarter when HUL has posted single-digit volume growth. In the March quarter, volume growth was 7 per cent. The company will declare its results for the second quarter on October 14.