HUL shares stuck in bear grip: Can the FMCG stock recover?

Shares of Hindustan Unilever Ltd (HUL) are under bear attack in the long and short term. As on June 25, the HUL stock gave negative returns for period up to 3 years. In five years, shareholders could reap just 5% gains. However, the stock managed to clock 157.40% returns in ten years. 

The technicals for the FMCG stock indicate it trades under all short-term and long-term moving averages. HUL has a low beta of 0.49 signaling very low volatility in a year. The RSI stands at 34.3, which signals the stock is neither oversold nor overbought on charts. 

Systematix Equities has a hold call on the stock with a target price of Rs 2,645. 

Key monitorables for the FMCG giant include performance in soaps, mass skin care, nutrition, oral care; rural vs urban demand outlook and cost inflation, said the brokerage. 

Nuvama Institutional Equities has reiterated its 'Buy' call with an unchanged target price of Rs 3,055.

The brokerage said HUL has strengthened its direct-to-consumer (D2C) play and expanded its digital footprint in FY25. 

The FMCG firm spread its D2C presence with the acquisition of skincare brand Minimalist and ramped up digital advertising, which now accounts for 40 per cent of its overall spend. As part of its strategy to expand its total addressable market (TAM), HUL launched premium global products from its parent portfolio, including hydration supplement Liquid IV and cosmetics brand Hourglass, aimed at the aspirational urban consumer.

HUL clocked a 200-basis point rise in its product mix toward 'Future Core' and 'Market Makers'—strategic segments aimed at long-term growth. Operational metrics also improved, with return on equity (RoE) rising to 20.5 per cent (from 20.2 per cent) and return on capital employed (RoCE) up to 28.7 per cent (from 27.9 per cent).

For the current fiscal, Nuvama sees a 3–4 per cent year-on-year (YoY) volume growth, up from 2 per cent in Q4 FY25. HUL's extensive brand portfolio -- over 50 brands across 15 categories -- includes 19 power brands, each generating over Rs 1,000 crore in annual revenue.