ICICI Securities Recommends Buying Hindustan Unilever with a Price Target of Rs 2800

ICICI Securities Upgrades Hindustan Unilever to BUY, Sees Improving Visibility on Durable Growth Phase

Hindustan Unilever (HUL) has been demonstrating an improving volume trajectory in fiscal year 2026, with the research team at ICICI Securities expecting a +6% growth in the fourth quarter. This trend is part of a long line of improving performance, and while bears may argue that earnings surprises are limited, the quality and durability of growth are pleasing.

Key highlights of HUL's performance include double-digit revenue growth in the Fabric Wash and Lifestyle Nutrition segments, which are likely to improve with the return of price growth. Additionally, the Liquids portfolio, characterized by high margins and faster growth, accounts for more than 10% of the company's portfolio. Furthermore, direct distribution has seen an increase of around 8%, with Minimalist clocking INR 7 billion in annual recurring revenue.

However, certain segments such as Glow & Lovely, Lifebuoy, and Pepsodent remain problematic. Despite this, the research team at ICICI Securities believes that strengthening execution and structural actions will lead to improving visibility on a more durable growth phase.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

Revenue, EBITDA, and PAT CAGR Projections

ICICI Securities has maintained its BUY rating for HUL with a DCF-based target price of INR 2,800, which implies a price-to-earnings ratio of 49x for March 2028. The research team has also incorporated consolidated financials into their model, providing a more comprehensive view of the company's performance.