Hindustan Unilever (HINDUNILVR) Q1 25/26 earnings summary

Executive summary

• Consolidated turnover reached INR 16,323 crore with underlying sales growth of 5% and underlying volume growth of 4%.

• Reported profit after tax (PAT) rose 6% year-over-year to INR 2,768 crore, aided by a lower effective tax rate and re-estimation of prior year tax provisions.

• Portfolio transformation and premiumisation drove consistent volume-led growth and market share gains, with future core and market maker segments now over 50% of the portfolio.

• Acquisition of 90.5% stake in Minimalist completed for INR 2,706 crore, delivering strong double-digit growth; demerger of Ice Cream business progressing.

• Leadership transition announced: Priya Nair appointed as CEO and Managing Director, succeeding Rohit Jawa.

Financial highlights

• EBITDA margin was 22.8%, down 130 bps year-over-year due to gross margin pressure and increased investments.

• Gross margin stood at 49.5%, down 190 bps year-over-year due to price-cost gap and strategic pricing actions.

• PAT before exceptional items declined 5% year-over-year.

• Advertising and promotion spend at 10.1% of sales, up 40 bps sequentially, supporting digital and innovation-led growth.

• Effective tax rate for the quarter was 16.2% after adjustments.

Outlook and guidance

• Growth guidance unchanged: first half of FY26 expected to outperform the second half of FY25, led by portfolio transformation and improving macro conditions.

• If commodity prices remain stable, anticipate low single-digit price growth and EBITDA margin in the 22%-23% range.

• Continued focus on sequential gross margin improvement, reinvestment in brands, and portfolio transformation.