Shares of Hindustan Unilever (HUL) were down sharply on Friday after concerns over sluggish revenue growth, even though its numbers did beat street estimates.

What Happened: In its latest financial report, HUL posted a standalone net profit of ₹2,717 crore for the September quarter, a 3.86% increase from the previous year. However, the company’s revenue inched up only 3.53% to ₹15,027 crore and its sales volume went up only 2.5% even though its products have become cheaper.

Concerns include potential profit pressures due to factors like price reductions, royalty payments and increased advertising spending. Analysts had also noted subdued rural demand due to consumer concerns over inflation.

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Analyst Reactions: Brokerage Jefferies said the company was trailing industry growth and that lower product prices have yet to induce customers to consume more amid a tough macroeconomic environment. The brokerage retained its “hold” rating on the stock and a ₹2,720 target price.

HUL’s board on Thursday declared an interim dividend of ₹18 per share.

Price Action: HUL’s share price was down 1.41% at ₹2,512.25 at the start of trade on Friday.

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