January 18, 2018 / 2:56 AM / 3 months ago

RPT-BREAKINGVIEWS-Unilever's $47 bln Indian arm is real beauty spot

(The author is a Reuters Breakingviews columnist. The opinions expressed are her own.) (Repeats with no changes to text for wider distribution.)

By Una Galani

MUMBAI, Jan 17 (Reuters Breakingviews) - India is set to become the consumer giant’s largest market by sales. Hindustan Unilever dominates sales of soap and is well positioned to fight off rivals. A multiple of almost 50 times forward earnings – more than twice its parent’s valuation – reflects that promise.

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CONTEXT NEWS

- Hindustan Unilever reported a 28 percent rise in quarterly profit on Jan. 17, beating consensus estimates.

- Net profit at the Indian diversified consumer goods maker rose to 13.3 billion rupees ($208 million) in the quarter ended Dec. 31, compared with 10.4 billion rupees a year earlier. Analysts polled by Thomson Reuters had estimated a net profit of 11.6 billion rupees on average.

- On Jan. 17, rival Patanjali Ayurved announced partnerships to sell its products online through eight e-commerce companies including Amazon and Flipkart. The company, co-founded by Baba Ramdev, also said it is not planning an initial public offering.

- HUL shares have risen 64 percent in the past year, twice as fast as rivals Colgate Palmolive-India, Dabur India, and Marico. They closed at 1,371 rupees, down 0.8 percent, on Jan. 17.

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Editing by Peter Thal Larsen and Bob Cervi

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