India a top strategic priority for Unilever’s new CEO, says HUL Chief Rohit Jawa
During the post-earnings call, HUL CEO Rohit Jawa said that the new CEO of Unilever, Fernando Fernandez, is positive on HUL's operational excellence. "He sees India as a very important part of his overall strategy. He would like India and U.S. to be his anchor markets," Jawa said.
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Unilever’s new CEO, Fernando Fernandez, is doubling down on India and views Hindustan Unilever (HUL) as a strategic long-term priority for the firm, said Chief Executive Officer Rohit Jawa, in a post-earnings call with analysts.
According to him, Fernandez wants to build India as one of his key markets along in the future. "It is true that Fernando sees India as a very important part of his overall strategy. He would like India and U.S. to be his anchor markets."
India remains Unilever’s second-largest market, contributing roughly 12 percent of its global sales. Back in February, Hein Schumacher had also underscored the strategic importance of the country, stating, "If you are running Unilever, you would not swap our Indian business with any other business."
Adding more on how Fernandez has high hopes for HUL, viewing it as a long-term investment in India rather than a quarter-to-quarter play, Jawa shared, "I think we are really fortunate to have him lead Unilever at this time.
And it's good for us because we've always had the priority from the ex-CEO Hein Schumacher, who said 'double down in India'. Alan Jope, before Schumacher, had put India on his strategy. So we've always been on the top of the table insofar as Unilever is concerned...What's good for HUL is also good for Unilever."
Fernandez, in a recent conversation with Barclays’ Warren Ackerman, reiterated his positive outlook on HUL’s performance. “Our brands and portfolio remain robust. Over the past three years, we have gained 200 basis points in market share in India,” he said.
He also highlighted his optimism around India’s quick commerce sector. Though this channel currently accounts for only around two percent of HUL’s revenue, he projected it could grow to contribute between 10 and 15 percent in the coming years.
"India is a very special place because richer Indians and poorer Indians live in close proximity that basically provide demand and supply of labour, making quick commerce a logical channel to grow," he explained.
The fast-moving consumer Goods (FMCG) giant announced its Q4 result for the fiscal year 2025, on April 25. The maker of brands like Dove and Horlicks reported a 3 percent decline in its consolidated profit to Rs 2,475 crore in Q4 FY25 compared to Rs 2,561 crore in the corresponding quarter in FY24. The company's standalone profit in Q4 stood at Rs 2,493 crore- an increase of 4 percent year-on-year.
HUL reduced its consolidated advertisement and promotion expenses by 6.5 percent to Rs 1,510 crore in the March quarter FY25 YoY. In Q4 FY24, HUL's ad expenses were Rs 1,616 crore. On a sequential basis, the consolidated ad expenses saw a marginal rise of 0.19 percent. HUL spent Rs 1,507 crore on ads and promotion in the December quarter (Q3) FY25.
Speaking on the distribution channels during the earnings call, Jawa noted that the Indian consumers shop omnichannel.
"...they shop for different needs at different points at different things. We as a company must serve our consumers in all the shopping missions. And quick commerce is clearly a shopping mission that certainly in the big cities, top eight cities and even beyond has got a good product market fit. We have a very much of a differentiated assortment and portfolio design on it."
Currently, HUL is ramping up its presence in this space. “So we are investing to serve that consumer shopper need. But it's still a third of our e-commerce business, which in-turn is only about 7-8 percent at this point, although growing fast,” he said.
