New Delhi, February 12 Fast-moving consumer goods major HUL expects FY27 to be better than the current fiscal, as the demand scenario continues to improve, CFO Niranjan Gupta said on Friday.
In addition, the company is also set to increase prices of products in the home care segment, in which it operates with popular brands such as Surf Excel, Rin, Vim, and Domex in detergent powders/liquids, dishwashers, and surface cleaners categories.
Crude oil prices have firmed up in recent weeks, while the rupee continues to depreciate, adding pressure on input costs across categories. Palm oil remains stable to inflationary, said Gupta during the earnings calls.
Prices of sulfur and n-paraffins, which are the primary raw materials for home care products, are also rising.
"So we continue to evaluate the cost dynamics and the cost trends, and therefore we continue to take calibrated price increases," he said, adding, "When you look at within the segments, clearly you see home care, we have already taken some price increases, and some more would be taken up as we move forward to offset these increases."
When asked about the timeline, Gupta said, "So the home care price (increase) will be soon. Some (batch with increased price) is already going into the market, and some will follow."
HUL, which reported a 5 per cent revenue growth and 4 per cent volume growth in the December quarter, expects further improvement in the demand scenario.
"Our broad-based growth in the current quarter reflects the gradual momentum across our portfolio," he said, adding, "Coupled with a positive operating environment, we expect growth in FY27 to be better than FY26."
Growth will continue to remain HUL's number one priority, Gupta added.
"We are moving with speed on our strategic priorities. As we look ahead, we expect the operating environment to remain conducive for a sustained recovery in consumption, aided by monsoon, normative inflation and supportive policy measures," he said.
However, Gupta also added that the geopolitical uncertainties will remain a concern and it will continue to track them.
"We will continue to invest in the business as needed to support sustained growth, and hence we expect our EBITDA margins to stay around the current guided range," he said.
About the urban versus rural markets, Gupta said that the demand from urban is picking up.
"We are seeing both urban and rural demand actually picking up. However, between them, we see rural demand actually picking up faster than urban demand," he said.
On quick-commerce, a channel in which HUL and other FMCG companies are having a faster growth, it has doubled down on investment.
"We have created a dedicated organisation for that. We have augmented our supply chain to cater to the service levels," Gupta added.