Hindustan Unilever a market performer: India Infoline

India Infoline has recommended a market performer rating on Hindustan Unilever (HUL) with target of Rs 238 in its October 27, 2008 research report. "HUL recorded 19.7% yoy growth in revenues at Rs 40.3 billion during Q3 F12/08. HUL recorded 6.9% yoy increase in net profit at Rs 4.4 billion mainly led by higher other income of Rs 830 million and lower interest outgo. HUL has recorded a strong double-digit revenue growth in the domestic FMCG division driven by strong growth in core HPC segment (led by smart 26% and 18% increase in soaps & detergents and personal care segments respectively). HUL has started focusing on new growth categories like high-end personal care (skin, hair care), foods and water."

"HUL has invested heavily in its water purifier business and expects to complete national roll out by F12/08. Higher adspend due to increasing competition in the core categories from emerging players like ITC and firm raw material prices could put pressure on margins going forward. We expect HUL to register revenue and profit CAGR of 15.6% and 18.1% respectively over the next two years. We recommend Market Performer rating on this stock, with a price target of Rs 238 an upside of 4.9%," says India Infoline's research report.

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Source: Moneycontrol