Urban woes persist, show HUL earnings

Volume growth slows in urban markets; up sequentially in rural

- Suneera Tandon

Across India's towns and cities, consumption has cooled. And, it's unlikely to pick up any time soon. That was the sombre message from the quarterly earnings of Hindustan Unilever Ltd, India's largest packaged consumer goods maker seen as a proxy for domestic consumption.

On Wednesday, the company reported flat volume growth for the third quarter, at a time when concerns of a demand slowdown have grown. Alongside, it has noted signs of a shift in consumer shopping behaviour towards smaller packs, a trend which has strengthened during the quarter.

"It's quite a clear trend that urban demand has been moderating for the last few quarters and rural has been growing and gradually recovering," CEO and managing director Rohit Jawa said during the virtual call with mediapersons, adding that the trend in urban markets is unlikely to reverse in the near term.

HUL derives 60% of its sales from urban markets, according to the company.