HUL Share Price Tumbles Over 4% Following Q3 2026 Earnings Report
Hindustan Unilever Ltd (HUL) witnessed a sharp decline in its share price, crashing more than 4% in trading on Thursday, February 12, 2026. This drop came immediately after the FMCG giant released its quarterly earnings for the October-December period, revealing mixed financial performance that has sparked investor concern and market volatility.
Q3 2026 Financial Results: Profit Slump and Revenue Growth
The company reported a significant 30% year-on-year decline in consolidated net profit from continuing business, which fell to ₹2,118 crore for the December quarter. This marks a substantial decrease from the ₹3,027 crore recorded in the same period last year. However, HUL also posted a consolidated net profit of ₹6,603 crore for the quarter, a two-fold jump compared to the previous year, largely attributed to a one-time positive effect from the demerger of its ice cream segment.
In terms of revenue, HUL demonstrated resilience with product sales revenue increasing by 5.71% to ₹16,197 crore, up from ₹15,322 crore in the corresponding quarter of the previous year. The company noted an exceptional item loss of ₹576 crore this quarter due to the implementation of new Labour Codes, impacting overall profitability.
Strategic Moves and Analyst Insights
During the December quarter, HUL completed the separation of its ice cream division, transferring it to Kwality Wall's (India) Ltd. This strategic demerger has influenced the financial figures, creating a complex earnings picture for investors to decipher.
Seema Srivastava, Senior Research Analyst at SMC Global Securities, provided commentary on HUL's performance, stating, "Management’s focus on premium brands, high-growth spaces, and quick commerce capabilities signals a strategic push toward future-ready channels and margin-accretive categories." She added, "Overall, HUL continues to demonstrate strong execution, volume-led growth resilience, and disciplined capital allocation, positioning it well for sustained long-term value creation amid a gradually improving demand environment."
Market Reaction and Future Outlook
The immediate market reaction to HUL's Q3 results has been negative, with the over 4% share price drop reflecting investor apprehension over the profit decline. Key factors influencing this include:
- The 30% fall in net profit from continuing business, raising questions about core operational efficiency.
- The exceptional loss from Labour Code implementation, adding to short-term financial pressures.
- Despite revenue growth, margins appear squeezed, highlighting competitive challenges in the FMCG sector.
Looking ahead, HUL's emphasis on premiumization and quick commerce is seen as a forward-looking strategy to drive future growth. The company's ability to navigate regulatory changes and market dynamics will be critical in determining whether this share price movement represents a buying opportunity or signals deeper issues. Investors are advised to monitor upcoming quarters for signs of recovery in profitability and sustained revenue momentum.
