Market

HUL only Nifty50 stock in the green in 2020; up 10% today

Updated : March 24, 2020 12:50 PM IST

The stock, which rose 10 percent during trade on Tuesday, is up 2 percent for the year.

However, it has shed 11 percent in the past one month amid the ongoing market mayhem due to the coronavirus pandemic.

The stock surged Tuesday after it announced the acquisition of intimate hygiene brand VWash from Glenmark Pharmaceuticals for an undisclosed sum.

FMCG major HUL is the only Nifty stock in the green for the year 2020. The stock, which rose 10 percent during trade on Tuesday, is up 2 percent for the year. However, it has shed 11 percent in the past one month amid the ongoing market mayhem due to the coronavirus pandemic.

The stock surged Tuesday after it announced the acquisition of intimate hygiene brand VWash from Glenmark Pharmaceuticals for an undisclosed sum. The acquisition includes intellectual property, trademark, and design of the brand, the company said in a BSE filing.

“The acquisition gives us entry into the currently underpenetrated and rapidly growing female intimate hygiene segment. The brand has a leadership position and fits well into the white spaces in our beauty and personal care business," said Sanjiv Mehta, HUL chairman and managing director.

Maintaining a 'buy' call on the stock, Motilal Oswal said that the acquisition helps HUL channel presence in chemist channel, health & beauty segment and in the e-commerce space.

In the current market rout that has seen over 35 percent decline in Sensex and Nifty this year, the FMCG sector has also been adversely affected. The BSE FMCG index has also lost over 20 percent in the ongoing selloff this year, with most stocks in the red.

Assessing the near-term impact of COVID-19, global brokerage Credit Suisse said that it expects an increase in consumption of health, hygiene and home packaged foods along with some pantry upstocking. Shutdown and lower out-of-home time could curb discretionary non-essential consumption, it added.

The brokerage believes that HUL and Nestle are better placed given their high revenue resilience and some margin tailwinds as a consequence of lower crude prices.

It added that HUL, Godrej Consumer, Nestle and Britannia are likely to gain from increased consumption in hygiene and foods.

For the December-quarter, the company has reported consolidated sales of Rs 9,978 crore, up 21 percent from last quarter and 3.81 percent from the year-ago period.

HUL only Nifty50 stock in the green in 2020; up 10% today

You May Also Like

As govt proposes transaction threshold overhaul, hotel bills above Rs 20,000, jewellery purchase of over Rs 1 lakh to come under I-T scanner

Fino Payments Bank posts Q1 operating profit of Rs 11 cr despite COVID-19 setbacks

Tata Steel slips into red, posts Rs 4,648 crore net loss in Q1

Trending on CNBC-TV18

recommended for you