### **Overview** Hindustan Unilever Limited (HUL) is India’s largest Fast-Moving Consumer Goods (FMCG) company, with an extensive portfolio of over 50 brands across 16 categories. Reaching more than **90% of Indian households**, HUL maintains **market leadership in over 85% of the categories it operates in**, backed by deep consumer insights, a vast distribution network, and a powerful innovation engine. The company is strategically transforming into a **future-ready, digitally powered Intelligent Enterprise**, with a focus on **volume-led profitable growth**, **premiumization**, and **digital-led disruption**. --- ### **Strategic Framework (Q4 FY2026 – Oct 2025)** HUL has defined **four core strategic priorities** to drive growth and profitability: 1. **Sharpen Consumer Segmentation** - Tailoring strategies for distinct consumer segments: - **Power Spenders** (affluent, brand-conscious) - **Premiumisers** (aspirational, seeking upgraded experiences) - **Democratisers** (value-driven, mid-tier consumers) - Utilizing a **multi-tier brand portfolio** to meet diverse socio-economic needs across geographies and channels. 2. **Increase Brand Desirability** - **Modernizing Core Brands**: Upgrading legacy offerings with new formulations (e.g., Dove Serum in Bar, Lux with Stratos) and emotionally resonant messaging. - **Expanding Premium Portfolio**: Launching science-backed innovations in **masstige (mass-prestige)** segments, particularly in beauty, personal care, wellness, and home care. - Key launches: *TRESemmé Silk Press*, *Vim UltraPro Floor Cleaner*, *Dove Serum Shower*, *Lakmé Rouge Bloom*, and *Minimalist*. 3. **Accelerate Future-Ready Capabilities** - Shifting to **social-first demand generation**, with **40% of media spend** on digital and over **12,000 influencers** engaged. - Expanding in high-growth channels: - **E-commerce & Quick Commerce (q-Commerce)** (now ~33% of online sales) - **Modern Trade** and **Specialty Channels** (health & wellness stores, beauty outlets, chemists) - Investing in **digital storefronts**, **D2C platforms (UShop, brand.com sites)**, and **Open Network for Digital Commerce (ONDC)** integration. 4. **Reshape the Product Portfolio** - Reallocating resources to **high-growth demand spaces** such as: - Beauty & Wellbeing (serums, sun care, clean beauty) - Lifestyle Nutrition (clinical nutrition, protein, diabetes care) - Premium Home Care (liquids, probiotic cleaners) - Condiments & Mini-Meals - Building a **Market Makers portfolio** worth ₹7,000 cr, aimed at creating new consumer categories. --- ### **Key Business Developments (2025)** #### **1. Ice Cream Demerger – Strategic Value Unlocking** - **Announced in May 2025**, the demerger of the **Ice Cream Business Undertaking (KWIL)** will create a **separate, publicly listed entity** focused exclusively on ice cream. - The standalone business will: - Operate iconic brands: **Kwality Wall’s, Magnum, Cornetto** - Leverage a dedicated **cold chain infrastructure** (250,000+ cabinets, 19 warehouses) - Benefit from **Unilever’s global ice cream R&D, innovation, and brand expertise** - Rationale: Limited synergies with HUL’s core supply chain, seasonal demand, and distinct capital intensity justify a standalone model for **strategic agility, talent retention, and investor access**. - The move is expected to **unlock shareholder value** and accelerate growth in the fast-expanding ice cream segment, which contributes ~3% of HUL’s turnover. --- #### **2. Digital Transformation & Supply Chain Innovation** HUL continues to lead in **end-to-end digitalization** across value chains: - **Supply Chain Nerve Centre (SCNC)**: Real-time, AI-driven data integration across planning, sourcing, manufacturing, and delivery. - **Lighthouse Factories**: **Three HUL factories** (Dapada, Sonepat, Doom Dooma) recognized by the **World Economic Forum** as **4IR Digital Lighthouses**—the most in India—due to full-scale automation, digital twins, and intelligent manufacturing. - **Project Samadhan**: Tech-enabled fulfillment ecosystem ensuring **next-day delivery** in metros, with automated warehouses and optimized logistics. - **Nano Factories**: Agile micro-production units enabling **faster time-to-market** for >500 niche SKUs and supporting innovation scale-up. - **AI in Demand Planning**: Dynamic forecasting adjusts ideal stock levels weekly across 100% of the portfolio. --- #### **3. Beauty & Wellbeing – A Core Growth Engine** HUL is aggressively expanding in **premium beauty**, targeting India’s growing affluent consumer base: - **Acquisition of Minimalist (90.5% stake)**: A **digital-first, science-backed skincare & haircare brand** with ₹500 crore ARR, strong in e-commerce and masstige segments. - The beauty division now contributes **> ₹12,000 crores** in revenue, with premium beauty growing at high double-digit rates. - **WiMI 2.0 Route-to-Market (RTM)**: A dedicated **Premium Retail Organization (PRO)** reaches 75,000+ specialty outlets, including beauty stores and pharmacies. - **Digital Innovation**: AI-powered tools like **Virtual Try-ons**, **Skin Analyser**, and *BeBeautiful* platform enhance customer experience. - **Brand Revitalization**: - **Pond’s** repositioned as a **scientific skincare innovator** - **Dove** launched *Scalp+ Hair Therapy* with niacinamide and zinc peptides - **Lux** and **Lifebuoy** upgraded with *Stratos*, a patented, plant-based skincare technology --- #### **4. Innovations & Technology Platforms** HUL leverages Unilever’s **global R&D strength** (20,000+ patents) and **Indian R&D hubs** (Mumbai, Bengaluru – 820+ scientists) to drive breakthrough products: - **Stratos Technology**: - First-of-its-kind **skincare technology in soap bars**, certified by **Skin Health Alliance UK** - Uses plant-derived polysaccharides, vitamins, and actives; reduces palm oil use and carbon footprint - Launched in Lux, Lifebuoy, and Dove bars - **Vim UltraPro Floor Cleaner**: - Combines **probiotic microorganisms** and **surface modification** for self-cleaning floors and long-lasting fragrance - Supported by "shelf-bot" (DPD) displays in modern trade to boost engagement - **Agile Innovation Hub**: - Uses **generative AI, virtual testing, and rapid prototyping** - Reduced innovation lead time by **up to one-third** - Piloted success with digital-first brands like **Acne Squad** and **Find Your Happy Place** --- #### **5. Distribution & Retail Ecosystem Modernization** - **Shikhar App**: - HUL’s **e-B2B platform** serving >1.4 million retailers - Features: **AI-powered ordering, personalised ads, CRM, loyalty, credit solutions, ONDC integration** - **70–80% monthly active users**, driving automation and increasing sales rep efficiency - **eRTM (Electronic Rural Trade Modernization)**: - Digitizes **kirana retailers**, enabling anytime ordering, transparency, and capital access - Achieved **80%+ Net Promoter Score**, indicating high retailer trust and adoption - **Kirana-Centric, Distributor-Inclusive Model**: - Empowers traditional trade with **digital tools, data analytics, and credit via bank partnerships** - **Direct servicing** of 69% of relevant product categories - **ONDC Integration**: - HUL is the first FMCG company to join ONDC via **UShop** and **Shikhar Seller App**, enabling small retailers to sell online seamlessly --- #### **6. Portfolio Strategy: Core, Future Core, & Market Makers** HUL has restructured its portfolio to prioritize growth and agility: - **Core (e.g., Lifebuoy, Surf Excel, Clinic Plus)**: Deep penetration, high distribution - **Future Core (e.g., Dove, TRESemmé, Pond’s)**: High-growth premium segments (~60% digital spend) - **Market Makers (e.g., OZiva, Liquid IV, Minimalist)**: New demand spaces, high innovation potential - **Portfolio Shift**: Over **200 bps migrated from Core to Future Core & Market Makers** in FY24–25 to capture growth from rising affluence and digital adoption. --- #### **7. Sustainability & Responsible Growth** - **Planned Demerger of Ice Cream** includes sustainability goals: reduced emissions, green logistics - **Stratos** reduces palm oil dependency and lowers carbon footprint - **Recycled Packaging**: Surf Excel, Comfort, and Vim liquids now use **≥50% recycled plastic** - Support for **National Mission on Edible Oils** via acquisition of Vishwatej Oil Industries’ palm undertaking - **Lucro Plastecycle partnership** to advance circular economy in flexible plastics --- ### **Financial & Operational Highlights (FY2025 Indicators)** - **Turnover**: Majority (~80%) from **superior brands** (outperforming competition) - **Surf Excel** surpassed **₹10,000 crores annual turnover**, becoming a **₹10K crore brand club member** - **Home Care Liquids**: > ₹3,000 crores, growing at **>20% YoY** - **E-commerce GSV Growth**: ~45% in FY25; q-commerce growing rapidly (small base, high potential) - **Cost Efficiency**: Achieved **3.59% net savings** via AI, data analytics, and operational excellence - **Distribution Reach**: **9 million+ outlets** served through **3,500+ distributors**, with direct reach to 3 million+