Hindustan unilever ltd

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					75 years of Independence…
          FMCG SECTOR
            FMCG SECTOR
>> 4th largest sector in the economy

>> total market share of Rs 450 bn

>> growth of 50% by 2010
>> main players
   HUL,ITC, COLGATE-PALMOLIVE,NIRMA
           HINDUSTAN UNILEVER
                LIMITED
•   Type            Public
•   Founded         1933
•   Headquarters    Mumbai, India
•   Key people
                   Harish Manwani Chairman
                   Douglas Baillie, CEO

• Industry          Fast moving consumer goods
• Products         Home and personal care,food and
                   beverages
• Employees        15,000
• Parent           Anglo-Dutch Co. Unilever
              HISTORY
> 1931, Unilever set up its first Indian
  subsidiary of Hindustan Vanaspati
  Manufacturing Co.
> 1933, Lever Brothers India Limited
> 1935 ,United Traders Limited .
> 1956 ,formed Hindustan Lever Limited.
> July 19, 2007,changed the name to
  Hindustan Unilever Limited
ESTABLISHMENT
            ESTABLISHMENT

• Hindustan Unilever Limited (abbreviated to
  HUL) formerly Hindustan Lever Limited is
  India's largest consumer products
  company and was formed in 1933 as
  Lever Brothers India Limited
                           HUL
>> Largest FMCG Co. in India
>> 20 distinct categories
     # home and personal care products
     # food and beverages
>> manufactured by 40 factories across India
>> combined volume of 4 million tonnes
>> sales of Rs 10,000 crores
>> 51.55% of equity held by parent Co. Unilever
>> rest distributed among 380,000 individual shareholders and
   financial institutions
>> distribution reaches 6.3mn retail outlets and 250 rural
   consumers
>> Golden super star trading house
:
            POPULAR BRANDS
• BATHING SOAPS:      Lux, Lifebuoy, Liril, Hamam, Breeze, Dove,
                      Pears and Rexona

•   LAUNDRY ITEMS: Surf Excel, Rin and Wheel
•   SKIN CARE:     Fair & Lovely, Pond’s and Vaseline
•   HAIR CARE:     Sunsilk and Clinic
•   ORAL CARE:      Pepsodent and Close up
•   DEODORENTS:    Axe and Rexona
•   COSMETICS:     Lakme
•   AYURVEDIC:     Ayush
•   TEA:           Brooke Bond and Lipton
•   COFFEE:        Bru
•   FOOD:          Kissan, Annapurna and Knorr
•   ICE CREAM:     Kwality Wall’s
                MISSION

>>> to add Vitality to life.

>>> help people feel good, look good and
    get more out of life.
MANAGEMENT STRUCTURE
> HEADED BY CHAIRMAN

> 5 WHOLE TIME DIRECTORS

> 5 INDEPENDENT NON-EXECUTIVE
     DIRECTORS
MANAGEMENT STRUCTURE

       Mr.Harish Manwani
       Chairman




       Mr.Douglas Baillie
       CEO and Managing Director
75 years of Independence…
PRODUCT SECTORS

         Detergents




 Deodr                Health
         SECTORS
  ants                 Care




         Hair Care
PRODUCTS
              SOAP BRANDS

•   LUX
•   BREEZE
•   REXONA
•   LIRIL
•   HAMAM
•   LIFEBOY
•   DOVE
•   PEARS
         SOAP MARKET
 60% Market Share
The strategy for 2006-07 would be to increase
 the market share from existing 60% to 70%.
Competitors :GodrejSoap: Cinthol , Shikhakai,
 Evita, Cinthol
Strategies
New product offering i.e. Fair & Lovely soap
Share went down from 3.6% to 2.4% 2006-
 2007
         DETERGENTS

                      Market share 2.5% -35%


Surf Excel, Rin,Wheel
Competitor - P&G - Ariel and Tide , Nirma
STING Policy against Nirma
       PERSONAL CARE SECTOR
                        Loosing 4.5% market share

Fair & Lovely, Ponds,Vaseline
Strategy-BOGOF
HLL is the market leader in the shampoo
 category with an 50 per cent market share
Shampoos-Sunsilk, Clinic plus,Clinic All Clear
       ORAL CARE SECTOR

Pepsodent,Closeup
Competitor-Colgate
 Pepsodent and CloseUp, grew at 11% Colgate
  brand grew at 14%
 Unilever has a market capitalisation of $95
  billion against Colgate's $34 billion. Unilever's
  annual sales are around $50 billion which is
  almost four times Colgate's $13 billion.
            FOOD SECTOR

Market share 70%
TEA:Brook Bond,Lipton
COFFEE: Brook Bond Bru largest brand.
Food: Kissan, Annapuna, Knorr-Largest brand
Ice Creams- Kwality, Amul
HUL’s market share            28%
                                              38%
dropped to 18.6% in                                   TEA

volume terms.                                         Coffee
                                                      Icecream


Coffee-Nescafe’s
share slipping from                  34%

31.8% to 23.6%.
Coffee Market Share 21%   30
                          25
                          20
                          15
                          10
                           5
                           0
                                     Tea   Coffee   Icecream
GROWTH IN THE PRODUCTS
Penetration %
         Toilet Soaps
 90%
         Tea
 70%           Laundry - NSD



 50%                  Toothpaste
                                   Shampoo

 30%    Ice-Creams                 Skin Creams
             Colour Cosmetics            Staples
                 Tomato                            Deodorant


        5%            10%          15%             Growth %
         MARKET POSITION
MARKET LEADER                   STRONG NUMBER 2

   Personal Wash         60%      Oral             36%
   Fabric Wash           42%      Hair Oils        14%
   Household Care        62%      Instant Coffee   36%
   Skin Care             53%      Ketchup          39%
   Hair Care             63%
   Talcum Powders        65%
   Branded Tea           35%
   Ice Creams            25%
   Jams & Squashes       78%
   R&G Coffee            56%
   Branded Staples       15%
   Branded Salt          18%
   Cooking Fats & Oils   29%
75 years of Independence…
       “INDIAN CONSUMER”
• The Indian middle class is prospering with around 70
  million households earning anywhere between Rs80,000
  and Rs18 lakh per annum. These comprise 34 per cent
  of the slightly over 200 million middle class households.
• Indian Consumer is no longer Price Obsessed.
• Indian consumer goods market is expected to reach
  $400billion by 2010
• Higher disposable incomes, there is money left over for
  daily products even after spending on durables
            “FMCG Tricks”

• Main reasons for the revival in the FMCG space is that the
wallet share of the consumer which was being diverted to
aspirational products is now coming back to FMCG products.
• Indian consumer on spending spree.
• There is a difference between FMCG and Consumer
Durables.
           Why Name Change ?
• Provides Optimum balance between maintaining the
  heritage of the company and the future benefits with the
  corporate name of Unilever. (February 20, 2007).

• Will be source of considerable strength and synergies to
  harness Unilever’s global scale and size for the benefit
  of the Indian business both in domestic and export
  markets.
• It would also assist in attracting and retaining talent both
  locally and internationally
     “Edge Over Competitors”
• Unilever, in its worldwide operations, strives to be a
multilocal multinational. Working since 1912.
•Reflected national priorities over the years and remained
committed towards India.
•Large market capitalization and Product Variety.
•Good Company policies such as:-
   Developing and using relevant technology
   Generating productive employment
   Stimulating industrialization and dispersing its benefits
   Adding value to agriculture
   Sustaining export performance
• Experimenting and taking    • System driven and
  aggressive steps.             conservative manner.
• Caught in scandal --        • Closely linked to parent
  whether on excise duty        Unilever.
  disputes.
• Situation has changed,      • Profits has decreased
  P/E ratio is greater than     even when the market is
  HUl.                          growing above 10%.
• E-Choupal                   • Project Shakti.
              “Project Shakti”
• To distribute their products in remote rural areas through
  its Project Shakti. (2000).
• Thirty per cent of FMCG business comes from villages
  with a population less than 2,000
• To reach areas of low access and low market potential.
  Currently covers all districts of Andhra Pradesh and
  Karnataka, reaching almost 5,000 villages through 800
  self-help groups (SHGs).
• The Shakti model trains women from SHGs to distribute
  HLL products of daily consumption such as Detergents,
  Toilet soaps and Shampoos
        “Company Profits”
7000
6000
5000
4000
                                          Quarter Ending
3000                                      Profits in Million
2000
1000
  0
       Jun,06      Dec,06        Jun,07

                Source: Company Reports
      “Modern Day Scenario”
• For the quarter ending June 2007, HUL has posted a
  growth of 13%(8%, 2006) in net sales to reach Rs. 34.31
  billion. The profits have been even better off, with PAT
  growing at 24.4% to reach 4.72 billion.
• The company is on a cost cutting spree, with reduced
  expenditure on advertisement by 2.7%( over 900
  million).
• FMCG BSE Index is above 2600 points.
• Share Khan has given BUY recommendation for HUl
  with CMP of 204.7 having Target price of 290.
     “Mergers and Acquisitions”
• Amalgamation of new businesses -- Brooke Bond Lipton
  India in 1996-97; Pond's India in 1998; and a smaller
  subsidiary, Industrial Perfumes, in 1999
• The erstwhile Tata Oil Mills Company (TOMCO) merged
  with HUL, effective from April 1, 1993
• In 1995, HUL and yet another Tata company, Lakme
  Limited,
• HUL formed a 50:50 joint venture with the US-based
  Kimberly Clark Corporation in 1994
• In 1992, the erstwhile Brooke Bond acquired Kothari
  General Foods, with significant interests in Instant
  Coffee
• In 1993, it acquired the Kissan business from the UB
  Group and the Dollops Icecream business from Cadbury
  India.
• In1994, the company entered into a strategic alliance
  with the Kwality Ice-cream Group families and in 1995
  the Milk food 100% Ice-cream marketing and distribution
  rights too were acquired.
• In January 2000, in a historic step, the government
  decided to award 74 per cent equity in Modern Foods to
  HUL, thereby beginning the divestment of government
  equity in Public Sector Undertakings (PSU) to Private
  sector partners. HUL's entry into Bread is a strategic
  extension of the company's wheat business. In 2002,
  HUL acquired the government's remaining stake in
  Modern Foods.
• In 2003, HUL acquired the Cooked Shrimp and
  Pasteurized Crabmeat business of the Amalgam Group
  of Companies, a leader in value added Marine Products
  exports.
Every 2 out of 3 is effected.
                  Awards
 Hindustan Unilever Limited (HUL) was conferred
the Commendation Certification for Significant
Achievement in HR Excellence by the Confederation
of Indian Industry (CII). Mumbai, October 22, 2007:
 Hindustan Unilever Limited (HUL) was in
September 2007 rated among the top four companies
globally in a global study of ‘Global Top Companies
for Leaders’ by Hewitt Associates in partnership with
Fortune magazine and the RBL Group
                   Awards
 HLL has been declared a Mini Ratna by the
Government of India .
 Upgraded in 2006 as a Schedule B Company by
the Department of Public Enterprises
 HINDUSTAN Lever Ltd (HLL) has bagged 20 India
Star awards and three Asia Star awards for innovation
in packaging concepts and systems.



                                     Source: Times of India
Profit Trends For Past Five Years
      2000
      1800
      1600
      1400
      1200
      1000
                                               Net Profit
       800
       600                                   In Rs. Crores
       400
       200
         0
             2002 2003 2004 2005 2006
                        Source: kotaksecurities.com
                Future Plans
 HLL has drawn up a comprehensive plan to expand its
portfolio in the area of Health Care and Contraceptives.
 Chemicals business (encompassing Flavours,
Fragrances and other Specialty Chemicals), as well as
several non-FMCG export businesses such as
Thermometers and Mushrooms.
 HLL has been pepping up its rural distribution systems
and has launched low unit price variants of its popular
brands to draw in new users in the rural areas.
  Social Responsibility
 Hindustan Latex set up the Hindustan
Latex Family Planning Promotion Trust
(HLFPPT) a not for profit organization, for the
purpose of designing and implementing social
sector intervention projects, particularly in the
area of Reproductive Health, Women
Empowerment and HIV prevention and
control activities, with the objective of
creating planned social change.
 HLFPPT is today India’s top social
marketing organization.
  Social Responsibility
 HLL promises a `Golden Future' for girl
child.
 PROJECT SHAKTI :The objectives of
Project Shakti are to create income-
generating capabilities for underprivileged
rural women by providing a small-scale
enterprise opportunity, and to improve rural
living standards through health and hygiene
awareness.
     Future Technology
Third Party Logistics (3PL): 3PL describes
businesses that provide one or many of a
variety of logistics-related services. Types of
services would include public warehousing,
contract      warehousing,        transportation
management,        distribution   management,
freight consolidation.
              Conclusion
With it’s long and luminous history HUL is India’s true pride. It is
a company which the customers in rural as well as urban India
relate to. This explains the deep penetration of HUL in Indian
market.
Past few years trends may be disturbing but there has been multi
facets to the decrease in profits. It would be innocent thought to
rule out a behemoth of the ranks of HUL.
The future for HUL is demanding newer and high level
innovations so as to cope up with increasing competition.
However HUL is well equipped with all what is needed of this
Indian Giant.
Thank you!!

				
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posted:5/15/2010
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