HUL is planning to enhance its presence in trending sectors such as beauty, foods, health and wellbeing
Hindustan Unilever (HUL) announced on Thursday that its board has decided to separate its ice cream business. This comes after the parent company also revealed a similar plan of demerging its €7.9 billion ice cream unit by the end of 2025, earlier this year.
“The board’s decision to separate is in line with the recommendation made by the independent committee following a comprehensive review of the business,” HUL said in its stock exchange filing.
On Thursday, the shares of the FMCG giant remained largely flat and concluded on Rs 2,659.35 price level, down by nearly 0.83 per cent on the National Stock Exchange.
While talks around the demerger of HUL's ice cream segment had been well-present in media, the FMCG giant has finally confirmed the separation.
By separating the ice cream business, HUL is planning to enhance its presence in trending sectors such as beauty, foods, health and wellbeing.
"This portfolio restructuring will enable HUL to sharpen focus on the core business and further strengthen its play in trending demand spaces such as Beauty, Foods, Health and Wellbeing. It will also enable the Ice Cream business to operate with greater flexibility and focus," the exchange filing stated.
With the aim of maximising value for all shareholders, the Board, based on the recommendations of the Independent Committee, will determine the mode of separation by the end of this year, the exchange filing further added.
The FMCG giant witnessed a marginal decline in its profit figures as revenue from operations softened.
Hindustan Unilever reported a 2.4 per cent decline in consolidated profit to Rs 2,591 crore from Rs 2,668 crore recorded in the corresponding quarter last year. Revenue figures witnessed a marginal rise. The consolidated revenue from operations figure stood at Rs 15,319 crore in the second quarter, up by just 2.1 per cent.
It is worth noting that the broader FMCG space continues to deliver a muted outlook. Both Tata Consumers and Nestle witnessed subdued performance in Q2FY25.