HUL confident of overcoming short-term challenges despite external volatility

Hindustan Unilever Ltd (HUL) said it is confident that it will face global disruptions, the new normal where businesses will have to face short-term responses that also build the future.

“There will be challenges in the short term and we hope to manage these challenges better than anyone else has managed,” Chairman Nitin Paranjpe said while answering questions from shareholders at the company’s 93rd annual general meeting on Tuesday. Paranjpe said he was “very, very positive about the company’s long-term prospects.”

India’s greatest president The FMCG company noted that modern disruptions are unlike those of the past, as they are now occurring simultaneously across geopolitics, supply chains and climate change.

“Over the past 12 months, we have witnessed conflicts that have disrupted energy markets and global trade routes,” Paranjpe said in his speech. “From heatwaves to erratic rainfall, fluctuations in climate have impacted agriculture, water systems and livelihoods.”

The question, he said, is no longer whether disruption will come, but whether these challenges can be turned into opportunities and whether what is done today to address short-term pressures can also become the foundations of long-term strength.

The Chairman said HUL has created a more agile and resilient supply chain. The vision behind Project Nakshatra, a multi-year supply chain transformation initiative, is to source the majority of the company’s raw materials locally and redesign its network for proximity and speed.

“Through Nakshatra, we have set up multi-category, multi-format factories close to demand centres, co-located suppliers and warehouses, and introduced nanofactories, which are compact, technology-driven manufacturing units capable of producing in rapid changeovers,” he said.

The initiative also covers last-mile delivery.

“In our supply chain, the Nano DC initiative launched this year introduces compact, channel-focused distribution units that use RFID tracking and GPS-enabled controls for real-time visibility, enabling high-frequency replenishment for fast-growing channels such as express trade,” Paranjpe said.

rural markets

HUL reports 5% increase in turnover ₹63,763 crore in FY26 driven by 4% volume growth. Rural market, volume driver for Indians The FMCG market continued to grow strongly for the company.

“Both rural and urban growth rates are relatively stable, with rural growing slightly faster than urban,” Paranjpe said.

In particular, management said HUL has ensured it maintains volume and affordability. rural areas use “accessible packages” and a portfolio of brands “on both sides of the price pyramid.”

Questions from shareholders ranged from the company’s growth outlook to the performance of acquired companies. brands and plans for new launches.

The Iran-US war, which began on February 28, has disrupted supply chains, with the closure of the Strait of Hormuz halting approximately 27% of world crude oil and petroleum maritime trade and 20% of global liquefied natural gas trade. This caused an increase in the prices of petroleum-derived products such as plastic, petroleum and cleaning products.

In its fourth-quarter results presentation in April, management said disruptions in the crude oil-related supply chain had increased input costs for HUL. This led to a 2-5 percent price increase on products. The company reported its highest sales volume increase in 15 months in the March 2026 quarter.

“We have set sharper priorities with a clear focus on volume-led growth,” CEO Priya Nair told analysts in April following fourth-quarter results. Although he was present at the General Assembly, he did not speak at the meeting.

Amid volatile external conditions, analysts are hopeful about HUL’s outlook.

“Despite concerns about rising crude oil prices and macro volatility, management believes the company is well positioned to navigate the environment through commodity hedges, accelerated cost savings initiatives, portfolio transformation strategies and strengthening omnichannel capabilities,” analysts at Motilal Oswal Financial Services said in a June 23 report.

HUL shares lost 1.54% ₹2,118.20 at the National Stock Exchange close on Tuesday. Nifty FMCG index fell 0.7 percent.