CEO Foresees Subdued Demand Trends, Urges Patience as Market Compounding Remains Key
Hindustan Unilever Ltd. (HUL) CEO and Managing Director Rohit Jawa has projected a muted consumption environment over the next few years, signaling caution amid current macroeconomic conditions. In an interview with Business Standard, Jawa emphasized that while short-term volatility may persist, the FMCG major must maintain patience, given that India remains a structurally strong market with long-term compounding potential. He reiterated that HUL would continue playing the “long game,” staying resilient and strategically focused on value-driven growth.
Jawa’s remarks follow HUL’s Q4 FY25 earnings report, where the company posted a 3.7% year-on-year (YoY) decline in consolidated net profit to Rs 2,464 crore. The company acknowledged ongoing pressure from commodity inflation and cost pressures that have impacted gross margins, even as it works to absorb input costs to remain competitive in a dynamic pricing environment.
Highlights:
HUL expects muted consumption for the next few years.
Q4FY25 profit fell 3.7% YoY to Rs 2,464 crore.
Cost pressures and commodity inflation continue to weigh on margins.
Rural Market Momentum Provides Hope as Urban Consumption Lags
While private consumption trends across India have not rebounded as expected, Jawa noted that there has been notable resilience in rural demand, which is growing at a faster pace than urban areas. This divergence in consumption patterns offers a silver lining for HUL, which has extensive rural distribution networks and a strong brand recall across non-urban regions. Jawa stressed that even though the pace of recovery remains uneven, HUL is seeing early signs of a rural-led revival, which the company intends to capitalize on.
The CEO highlighted that the firm remains confident in its long-term category growth across all product segments, and despite temporary sluggishness, HUL expects its categories to multiply manifold over the next decade.
Highlights:
Rural demand is outpacing urban recovery.
HUL sees rural resilience as a key opportunity.
Long-term category growth expected across personal care, foods, and health segments.
Strong Margin Position Underpins Resilience Amid Market Volatility
Amid softening consumption trends and inflationary pressures, Jawa emphasized that HUL maintains a healthy EBITDA margin of 22–23%, placing it among the top-tier consumer packaged goods (CPG) players globally. He described the business as “good and profitable,” with an operational foundation strong enough to weather economic uncertainty and simultaneously pursue faster growth when tailwinds return.
This margin stability, he noted, allows the company to invest strategically across categories, accelerate innovation, and ensure sustained competitiveness. Jawa reinforced that HUL’s financial strength would be leveraged to capture medium- and long-term growth opportunities, rather than reacting hastily to short-term headwinds.
Highlights:
HUL maintains a 22–23% EBITDA margin, among the best in the sector.
Strong margins enable strategic investment and cost absorption.
Margin strength seen as key to long-term profitability and brand-led growth.
Global Risks Minimal as HUL Reaffirms ‘Local-for-Local’ Strategy
When questioned about the potential impact of US President Donald Trump’s tariff regime, especially in light of ongoing trade tensions and protectionist policies, Jawa dismissed any significant risk to HUL’s operations. He emphasized that HUL is a “local-for-local” business, focused on manufacturing, sourcing, and selling within the Indian market, which makes it largely insulated from international tariff threats or cross-border regulatory disruptions.
He also pointed out that the recent softening of crude oil prices, even amid geopolitical uncertainties, could help ease inflationary pressures in India. Lower oil prices have a cascading positive effect on transportation and packaging costs, ultimately benefiting both the consumer and HUL’s operational margins. Jawa stated that a more stable crude environment could offer tailwinds for consumption recovery, especially in value-sensitive categories.
Highlights:
HUL’s local sourcing model shields it from global tariff risks.
Crude price softening may boost consumption sentiment and cost efficiency.
Jawa sees opportunity to capitalize on domestic macro stability.
Focus on Brand Revamps: Horlicks, Lifebuoy, and Glow & Lovely in Spotlight
Jawa also discussed HUL’s ongoing efforts to revamp key legacy brands as part of a broader innovation and relevance strategy. After recent updates to Lifebuoy and Glow & Lovely, the company is now working on repositioning Horlicks, a marquee brand in the health and nutrition space. The company believes that evolving consumer preferences around health, hygiene, and wellness offer room for legacy brand transformations that are both culturally resonant and scientifically modernized.
The push toward brand rejuvenation is in line with HUL’s long-term focus on premiumization, innovation, and inclusivity, themes that have increasingly shaped consumer choices in a post-pandemic economy.
Highlights:
Horlicks is the next in line for brand transformation.
Lifebuoy and Glow & Lovely have already been revamped for modern consumers.
Focus remains on health, hygiene, and premium brand positioning.
