According to Prabhudas Lilladher's research report dated July 28, 2026, the brokerage has recommended an Accumulate rating on Hindustan Unilever Limited with a target price of ₹2320. The current target price represents a revision from the earlier target of ₹2454, indicating a more conservative outlook for the FMCG major.
As reported by Prabhudas Lilladher, the firm has cut FY27/FY28 EPS estimates by 1.9% and 1.2% respectively. The downward revision is attributed to several factors including less than expected volume growth of 5% consolidated (4-4.5% standalone), input cost pressures in soaps and tea requiring price hikes, competition and crude-led margin pressure in home care, and likely pickup in advertising spends with an 80bps cut in 1Q27 ad spends.
According to the research report, HUL is facing competitive pressure in home care and toilet soaps but has managed to post a strong comeback in Beauty and Nutrition business. The company continues to focus on new channels, premium products and innovations that will enable increased traction across categories. The firm is currently facing 8-10% raw material inflation and expects calibrated price hikes to offset cost pressures.
As reported by Prabhudas Lilladher, the firm estimates a CAGR of 9% in Sales and 8.7% in PAT over FY26-28. The brokerage has assigned a DCF-based target price of ₹2320, down from the earlier target of ₹2454. The stock currently trades at 39.6x FY28 EPS, which the report suggests may attract bottom fishing at current levels.
According to the research report, key risks to margins over the next 2-3 quarters include any increase in crude prices and likely increase in palm oil prices due to EL Nino effects. Despite these challenges, the firm maintains a positive long-term outlook on the company's diversified portfolio strategy and market positioning across multiple FMCG categories.
