FIBA ASSIGNMENT

TOPIC: FINDINGS OF NTCC

SUBMITTED BY:

NAME: ANSHI GUPTA

ENROLLMENT NO.: A90904618081
COURSE: B.COM(H)
SESSION:2018-2021
SECTION: 3B
SEMESTER: 3
GUIDED BY: ANANDI MA’AM

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 AN INTRODUCTION ON HUL

HINDUSTAN UNILEVER Ltd. is a British-Dutch manufacturing company

headquartered in Mumbai, India. Its products include foods, beverages, cleaning
agents and consumer goods. It was established in 1993 as Lever Brothers and
following merger of constituent in 1956 was renamed as Hindustan Unilever
Limited. As of 23019, Hindustan Unilever Portfolio had 35 product brands in
20 categories and employs 18000 employees with sales of Rs 34619 crores in
2017-18.
In December 2018, HUL announced its acquisition of Glaxo Smithkline’s India
business for 3.8 billion in an all equity merger deal WITH 1:4:39 ratio. HUL is
the market leader in Indian consumer products with presence in over 20
consumer categories with over 700 million consumers using its products.
HUL ranked number one on the Forbes list of ‘most innovative companies’
across the globe for the year 2014 and was ranked number three on Fortune’s
India list of India’s most admired companies in a list compiled with the help of
a global management consultancy Hay Group
HUL was ranked 47th in The Brand Trust Report 2014 published by Trust
Research Advisory. 36 HUL brands also featured in the list including
Lux, Dove, Lipton, Vim, Kissan, Bru, Rexona, Close Up, Clinic Plus, Pond's,
Knorr, and Pepsodent among others.
HUL emerged as the top 'Dream Employer' as well as the top company
considered for application in the annual B-School Survey conducted by Nielsen
in November 2010. This was the second successive year that HUL has been
rated as the top 'Dream Employer' in India. HUL has also emerged as the top
employer of choice among the top six Indian Institutes of Management (IIMA,
B, C, L, K and I).
HUL won three awards at the 'CNBC Awaaz Storyboard Consumer Awards' in
2011 – Most Recommended FMCG Company of the Year; Most Co Consumer
Conscious Company of the Year and Digital Marketer of the Year.

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 Executive summary

To analyse the past performance and the future demand of HUL, FMCG
products we have considered the following points :

 We have listed the different FMCG product lines of HUL. We have done
competitor’s analysis We

 have done the SWOT ANALYSIS to know the threat and opportunities of
HUL in present market.

 Then performance analysis is made by taking 5 years financial data. The

profit and sales growth is analysed.

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1. BALANCE SHEET ANALYSIS

LAST FIVE YEARS BALANCE SHEET OF HUL

------------------- in Rs. Cr. -------------------
Mar '19 Mar '18 Mar '17 Mar '16 Mar '15

 
           
  12 mths 12 mths 12 mths 12 mths 12 mths
         

Sources Of Funds          
Total Share Capital 216 216 216 216 216.35
Equity Share Capital 216 216 216 216 216.35
Share Application Money 25 0 0 0 0
Reserves 7,418.00 6,859.00 6,274.00 6,063.0 3,507.76
0
Networth 7,659.00 7,075.00 6,490.00 6,279.0 3,724.11
0
Total Liabilities 7,659.00 7,075.00 6,490.00 6,279.0 3,724.11
0
Mar '19 Mar '18 Mar '17 Mar '16 Mar '15

 
           
12 mths 12 mths 12 mths 12 mths 12 mths

 
           
Application Of Funds          
Gross Block 5,912.00 5,234.00 4,689.00 3,207.0 4,430.63
0
Less: Revaluation Reserves 0 0 0 0 0.67
Less: Accum. Depreciation 1,569.00 1,092.00 665 293 1,973.10
Net Block 4,343.00 4,142.00 4,024.00 2,914.0 2,456.86
0
Capital Work in Progress 373 430 203 386 479.01
Investments 2,949.00 3,111.00 3,779.00 2,780.0 3,277.93
0
Inventories 2,422.00 2,359.00 2,362.00 2,528.0 2,602.68
0
Sundry Debtors 1,673.00 1,147.00 928 1,064.0 782.94
0
Cash and Bank Balance 3,688.00 3,373.00 1,671.00 2,759.0 2,537.56
0
Total Current Assets 7,783.00 6,879.00 4,961.00 6,351.0 5,923.18
0
Loans and Advances 2,417.00 2,587.00 1,784.00 1,489.0 1,496.41
0

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Total CA, Loans & Advances 10,200.0 9,466.00 6,745.00 7,840.0 7,419.59
0 0
Current Liabilities 8,656.00 8,651.00 7,389.00 6,757.0 6,367.06
0
Provisions 1,550.00 1,423.00 872 884 3,542.22
Total CL & Provisions 10,206.0 10,074.0 8,261.00 7,641.0 9,909.28
0 0 0
Net Current Assets -6 -608 -1,516.00 199 -2,489.69
7,659.00 7,075.00 6,490.00 6,279.0 3,724.11
0
Total Assets

Contingent Liabilities 2,009.00 1,699.00 1,241.00 1,158.0 1,072.71

0
Book Value (Rs) 35.27 32.69 29.99 29.02 17.21

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2. Profit and loss analysis

Profit & Loss account of Hindustan Unilever

           
------------------- in Rs. Cr. -------------------
           
  Mar '19 Mar '18 Mar '17 Mar '16 Mar '15

 
12 mths 12 mths 12 mths 12 mths 12 mths

 
 
Income        
Sales Turnover 38,224.00 35,218.00 34,487.00 33,491.00 32,721.44
Excise Duty 0 693 2,597.00 2,430.00 1,915.82
Net Sales 38,224.00 34,525.00 31,890.00 31,061.00 30,805.62
Other Income 437 507 767 533 1,282.69
Stock Adjustments -12 71 -156 -87 -58.28
Total Income 38,649.00 35,103.00 32,501.00 31,507.00 32,030.03
Expenditure        
Raw Materials 17,948.00 16,303.00 15,529.00 15,218.00 15,690.28
Power & Fuel Cost 269 259 257 271 304.62
Employee Cost 1,747.00 1,745.00 1,620.00 1,573.00 1,578.89
Selling and Admin Expenses 4,552.00 4,105.00 3,470.00 3,600.00 0
Miscellaneous Expenses 5,059.00 4,908.00 4,811.00 4,563.00 7,965.31
Total Expenses 29,575.00 27,320.00 25,687.00 25,225.00 25,539.10
Mar '19 Mar '18 Mar '17 Mar '16 Mar '15

 
 
  12 mths 12 mths 12 mths 12 mths 12 mths

 
Operating Profit 8,637.00 7,276.00 6,047.00 5,749.00 5,208.24
PBDIT 9,074.00 7,783.00 6,814.00 6,282.00 6,490.93
Interest 28 20 22 15 16.82
PBDT 9,046.00 7,763.00 6,792.00 6,267.00 6,474.11
Depreciation 524 478 396 321 286.69
Profit Before Tax 8,522.00 7,285.00 6,396.00 5,946.00 6,187.42
PBT (Post Extra-ord Items) 8,522.00 7,285.00 6,396.00 5,946.00 6,187.42
Tax 2,486.00 2,048.00 1,906.00 1,809.00 1,872.16
Reported Net Profit 6,036.00 5,237.00 4,490.00 4,137.00 4,315.26
Total Value Addition 11,627.00 11,017.00 10,158.00 10,007.00 9,848.82
Equity Dividend 4,546.00 3,896.00 3,571.00 3,354.00 3,245.32
Corporate Dividend Tax 913 755 693 655 635.9

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Per share data (annualised)        
Shares in issue (lakhs) 21,647.04 21,645.29 21,643.50 21,639.37 21,634.65
Earning Per Share (Rs) 27.88 24.19 20.75 19.12 19.95
Equity Dividend (%) 2,200.00 2,000.00 1,700.00 1,600.00 1,500.00
Book Value (Rs) 35.27 32.69 29.99 29.02 17.21

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 Graphical representation of profit and loss

Profit and loss in crores for the last five years

7000

6000

5000

4000

3000

2000

1000

0
2018-2019 2017-2018 2016-2017 2015-2016 2014-20`5

ANALYSIS

As we can see from the above graph HUL’s profit is increasing as we are
moving forward. This shows that HUL is continuously growing and maintaining
it.

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3. Cash flow statement analysis
Hindustan Unilever
Cash Flow Statement
------------------- in Rs. Cr. -------------------
Mar '19 Mar '18 Mar '17 Mar '16 Mar '15

 
 
  12 12 12 12 12 mths
mths mths mths mths

 
Net Profit Before Tax 8522 7347 6155 5977 5523.12
Net Cash From Operating Activities 5728 5916 4953 3974 3103.76
Net Cash (used in)/from -264 -1264 -752 -51 448.04
Investing Activities
Net Cash (used in)/from Financing Activities -5462 -4651 -4264 -4008 -
3450.44
Net (decrease)/increase In Cash and Cash 2 1 -63 -85 101.36
Equivalents
Opening Cash & Cash Equivalents 573 572 635 720 620.61
Closing Cash & Cash Equivalents 575 573 572 635 721.97

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4. ANALYSIS OF DIFFERENT RATIOS OF HUL FOR THE
LAST FIVE YEARS

KEY FINANCIAL RATIOS

  Mar '19 Mar Mar Mar Mar '15
'18 '17 '16

Investment Valuation Ratios

Face Value 1.00 1.00 1.00 1.00 1.00
Dividend Per Share 22.00 20.00 17.00 16.00 15.00
Operating Profit Per Share 39.90 33.61 27.94 26.57 24.07
(Rs)
Net Operating Profit Per 176.58 159.50 147.34 143.54 142.39
Share (Rs)
Free Reserves Per Share -- -- -- -- --
(Rs)
Bonus in Equity Capital 60.96 60.96 60.96 60.96 60.86
Profitability Ratios
Operating Profit Margin(%) 22.59 21.07 18.96 18.50 16.90
Profit Before Interest And 20.86 19.37 17.43 17.16 15.66
Tax Margin(%)
Gross Profit Margin(%) 21.22 19.69 17.72 17.47 15.97
Cash Profit Margin(%) 17.45 16.46 14.32 14.19 12.53
Adjusted Cash Margin(%) 17.45 16.46 14.32 14.19 12.53
Net Profit Margin(%) 15.79 15.16 14.07 13.31 14.00
Adjusted Net Profit 15.52 14.92 13.85 13.08 13.73
Margin(%)
Return On Capital 114.59 104.12 95.17 95.42 148.75
Employed(%)
Return On Net Worth(%) 79.06 74.02 69.18 65.88 115.87
Adjusted Return on Net 82.04 74.89 65.46 66.37 98.03
Worth(%)
Return on Assets Excluding 35.27 32.69 29.99 29.02 17.21
Revaluations
Return on Assets Including 35.27 32.69 29.99 29.02 17.22
Revaluations
Return on Long Term 114.97 104.12 95.17 95.42 148.75
Funds(%)
Liquidity And Solvency
Ratios
Current Ratio 1.00 0.94 0.82 1.03 0.75
Quick Ratio 0.73 0.68 0.51 0.67 0.47
Debt Equity Ratio -- -- -- -- --
Long Term Debt Equity -- -- -- -- --
Ratio
Debt Coverage Ratios
Interest Cover 313.46 368.35 280.77 399.47 329.37
Total Debt to Owners Fund -- -- -- -- --
Financial Charges 332.18 392.25 298.77 420.87 346.41
Coverage Ratio
Financial Charges 235.29 286.75 223.09 298.20 274.60
Coverage Ratio Post Tax
Management Efficiency
Ratios

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Inventory Turnover Ratio 15.78 14.93 14.60 13.25 12.57
Debtors Turnover Ratio 27.11 33.28 32.02 33.64 38.52
Investments Turnover Ratio 15.78 14.93 14.60 13.25 12.57
Fixed Assets Turnover 6.98 7.09 7.38 9.72 6.99
Ratio
Total Assets Turnover 5.29 5.15 5.21 4.96 8.32
Ratio
Asset Turnover Ratio 5.19 5.09 4.99 6.21 8.80
 
Average Raw Material -- -- -- -- --
Holding
Average Finished Goods -- -- -- -- --
Held
Number of Days In Working -19.35 -29.49 -33.73 -13.25 -32.52
Capital
Profit & Loss Account
Ratios
Material Cost Composition 46.95 47.22 48.69 48.99 50.93
Imported Composition of -- -- -- -- 9.28
Raw Materials Consumed
Selling Distribution Cost 11.90 11.88 10.88 11.59 --
Composition
Expenses as Composition 0.84 1.12 1.69 1.79 1.86
of Total Sales
Cash Flow Indicator
Ratios
Dividend Payout Ratio Net 75.31 74.39 79.53 81.07 75.20
Profit
Dividend Payout Ratio 69.29 68.17 73.08 75.23 70.52
Cash Profit
Earning Retention Ratio 27.42 26.48 15.96 19.53 11.12
Cash Earning Retention 33.02 32.57 23.13 25.29 17.59
Ratio
AdjustedCash Flow Times -- -- -- -- --

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 COMPUTATION OF CURRENT RATIO

▪ CURRENT RATIO = CURRENT ASSETS/CURRENT LIABILITIES

For the year:

✓ 2018-2019

CURRENT RATIO = 1.00

✓ 2017-2018

CURRENT RATIO = 0.94

✓ 2016-2017

CURRENT RATIO = 0.82

✓ 2015-2016

CURRENT RATIO = 1.03

✓ 2014-2015

CURRENT RATIO = 0.75

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GRAPHICAL REPRESENTATION OF CURRENT RATIO

CURRENT RATIO CHART

1.2

0.8

0.6

0.4

0.2

0
2018-2019 2017-2018 2016-2017 2015-2016 2014-2015

Analysis

As we can see from the graph, current ratio of HUL is above one or near to one.
This tells us that the investors can invest in HUL with minimum risk and
maximum chances of getting return.

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 5. SWOT ANALYSIS

STRENGTH
● Variety of products
● Distribution network
● Brand image

THREATS
● Pantene
● Dabur
● Babul

OPPORTUNITIES
● Huge market
● Increasing per capita \l income
● Increasing consumption pattern

WEAKNESSES
● Not able to compete with local competitor in rural market
● Not focus on upper class population
Pricing policy is not good

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6. THE COMPARITIVE DATA OF % MARKET SHARE OF
HUL AND ITS COMPETITOR

COMPETITORS ANALYSIS
80
70
60
50
40
30
20
10
0
AS
H
AS
H
AS
H IN
PO
O O S OS TE
A EE M
S
W SK DE DE T FF JA
IC LW SH
W A M R KE CO
R NE DI SH DE C
AB SO W PA
F R PO
PE M
LCO
TA

HUL COMPETITOS

ANALYSIS

As mentioned in the above graph HUL is enjoying the leader position in market
and is having the highest market shares which are followed by other challenges
in different categories of FMCG products like skincare, shampoo, deo, jams,
coffee, etc.

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7. MARKET SHARE ANALYSIS OF FMCG COMPANIES IN
INDIA

MARKET SHARE

HUL
19%
ITC
34% NESTLE
4% BRITANIA
DABUR
6%
OTHERS
8%

29%

ANALYSIS

In the above pie chart, we can see the position of various FMCG companies
doing business in India. We can see that HUL is enjoying the position of market
leader and is followed by ITC as second in the market share of FMCG products.

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 Conclusion

HUL is a leasing FMCG company in India and from last three consecutive years
has shown accelerated growth in FMCG portfolio. Customer’s in India is also
spending more in FMCG as their standard of living is growing. HUL has placed
itself successfully in the position of market leader in FMCG products. Though
there were some downfall in sales and profit of the company in the beginning of
this decade but after that HUL has shown considerable rise in both profit and
sale.

HUL has also started project SHAKTI that has provided direct reach to rural
market. This may be considered a revolutionary step since the urban market is
reaching its saturation level and there is huge scope in exploring rural market.
This will also be helpful in not only increasing its market share but also fight
competition.

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 Bibliography

In order to make this project, we have taken help from the following websites:
www.investopedia.com
www.scribd.com
www.hul.co.in

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