Shares of Hindustan Unilever Limited (HUL) rebounded sharply on July 29 after witnessing a steep decline in the previous trading session. Although the FMCG giant's stock slipped nearly 7% after its Q1 FY27 earnings, investor sentiment improved as leading brokerage firms reaffirmed their confidence in the company's long-term growth strategy and raised their outlook on the stock.
HUL Shares Recover After Sharp Sell-Off
HUL shares opened at ₹2,050 and climbed to an intraday high of ₹2,092 during early trade. The recovery comes after the stock faced heavy selling pressure on July 28 following the company's quarterly earnings announcement.
Market experts believe renewed buying interest reflects confidence in HUL's improving business momentum despite short-term margin challenges.
HSBC Gives 'Buy' Rating, Sees 21% Upside
Global brokerage HSBC maintained its 'Buy' recommendation on Hindustan Unilever with a target price of ₹2,450, indicating an upside potential of around 21% from current levels.
According to HSBC:
Strong growth in the Home Care business remains a key positive.
The Beauty & Wellbeing segment continues to deliver robust performance.
Attractive valuations make the stock appealing for long-term investors.
Rising prices of tea and soap remain short-term risks to profitability.
Motilal Oswal Reiterates Buy Call
Domestic brokerage Motilal Oswal also retained its 'Buy' rating on HUL and fixed a target price of ₹2,500.
The brokerage highlighted that:
HUL recorded double-digit revenue growth for the first time in 12 quarters.
Revenue growth was supported by a 5% increase in volumes.
Strong demand across categories reflects improving consumer sentiment.
Higher raw material costs continue to put pressure on Home Care margins.
Margins Under Pressure, Growth Outlook Remains Positive
HUL has acknowledged that rising commodity prices are likely to keep operating margins under pressure in the near term. However, analysts believe the company's focus on volume-led growth, premium product portfolio, and strong brand positioning will support earnings over the long run.
Brokerages also expect HUL to benefit from improving rural demand and sustained growth across key FMCG categories.
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