NEW DELHI: FMCG major Hindustan Unilever, which on Thursday reported standalone net profit of 16.76% year-on-year (YoY) to Rs 2,243 crore for the December quarter, has warned the country is witnessing a rural slowdown.
While HUL has gained market share in both urban and rural areas in the concerned quarter, its chairman and managing director Sanjiv Mehta in a post-earnings virtual call noted, “We are now seeing a slowdown happening in rural areas from a volume and value perspective.”
“The rural economy is in slowdown mode and reversing it would require putting more cash in the hands of the consumer,” Mehta said. High inflation and increase in price by companies has impacted consumer spending, according to analysts. The company had reported standalone net profit of Rs 1,921 crore in December last year. Sales of the company rose 10% to Rs 12,900 crore as against Rs 11,682 crore in the year-ago period. HUL has also clocked 11% growth in domestic consumer growth.
Looking ahead, HUL said, FMCG market growths are moderating and inflation impacting volumes. “Commodities remain volatile and elevated, witnessing further sequential inflation in MQ’22.” Analysts have highlighted that continued commodity inflationary pressures may have impacted the performance of FMCG companies in the December quarter. The home care segment has grown 23%, beauty & personal care grew 7% and foods & refreshment grew 3%, HUL said in a statement.