Hindustan Lever—the largest FMCG company in India—has finally come out of recessionary pressures. The Unilever subsidiary in India reported a 17.1 per cent rise in second quarter profit on improved sales. In Q2 June 2005, the company’s net profit (before exceptional items) rose to Rs 300 crore from Rs 256 crore a year earlier. After exceptional items, the net profit rose 15.1 per cent to Rs 281 crore from Rs 244 crore. ‘‘This is much higher than market expectation of a Rs 275 crore for the quarter,’’ said an analyst. The company had seen net profit slide for five consecutive quarters on high raw material costs and sluggish sales. Sales rose more than 10.2 per cent to Rs 2,836 crore from Rs 2,571 crore. The market was expecting a sales turnover of Rs 2,775 crore. ‘‘We haven’t fully neutralised the impact of high input prices, but wherever possible, we have managed the higher crude oil-driven raw material costs through cost management and judicious prices increases,’’ said Finance Director D Sundaram. ‘‘This will be our strategy for the future, as well,’’ he said. Besides sluggish sales and high input costs, the company was also caught in a price war with Procter & Gamble last year. But it has since raised product prices, relaunched some products, and benefitted from tax changes and fiscal benefits for new plants in some states. ‘‘We will do whatever it takes to maintain our leadership position,’’ Sundaram said. Shares in Lever, which makes Lux, Wheel, Pepsodent and Lipton, rose 1.6 per cent to Rs 166.95 on the BSE which hit a new high on Friday. Lever shares gained 24 per cent in the April-June quarter.
