Consumer goods major Hindustan Unilever Ltd plans to step up spending on its business, raising productive capital expenditure to 3% of turnover from around 2% to deliver long-term, competitive, volume-led profit growth.
The Lux and Surf Excel maker said this in its Capital Markets Day presentation submitted to the stock exchanges on Friday.
Over the last five years, total capex for growth & savings was 2% of turnover. The company reported an annual turnover of ₹63,763 crore in FY26.
HUL also said that it will decisively enter select high-growth spaces that exhibit sustainable growth, have a profit pool, and are spaces where HUL has the right to win. This includes categories such as male grooming, masstige skincare (a combination of high-end ingredients at affordable prices), fragrances, vitamins and minerals, healthy snacking, protein, hydration, ready-to-drink products, and functional deodorants.
The company reiterated the focus on volume-led growth. Category growth will be driven by four core levers: increasing consumption (more usage), accelerating premiumisation (more benefits), leading market-making in under-penetrated segments (more users), and expanding into new spaces (more categories). HUL said its premium brands receive twice the investment as the rest of the portfolio.
HUL has been streamlining its portfolio through the sale of non-core assets such as Pureit, the demerger of its ice cream business, and the divestment of Nutritionalab.
The company has also made major acquisitions in newer territories over the past few years. HUL acquired the plant-based nutrition brand Oziva and the science-first skincare brand Minimalist in recent years.
The firm has set a target to generate 500 basis points of ‘fuel’ to reinvest in funding its core growth pools. To boost its high-end business, HUL aims to expand its most profitable premium lines 50% faster than its core everyday products. A new multi-year plan will modernize operations and use advanced product formulations to boost cost savings a full percentage point above historical levels.
Interestingly, HUL expects to achieve a 10%-plus improvement in media effectiveness by using artificial intelligence to transform content creation and optimize return on investment (ROI) in real time.
HUL’s revenue rose to a 13-quarter high of 10% to ₹17,341 crore, led by higher sales and price increases in the April-June quarter of FY27. The earnings before interest, taxes, depreciation, and amortisation (Ebitda) margin stood at 23%, down 40 basis points from the year-ago quarter.
Shares of the company hit a 52-week low earlier this week. HUL’s shares were trading down 26.04% from a year ago on the National Stock Exchange, compared with a 3.20% drop of the benchmark Nifty 50 in the same period.