HUL`s net dips 3% despite 23% rise in operating profit

Company says inflationary pressures are a cause for concern.

Led by price hikes and high consumer demand across categories, fast moving consumer goods major Hindustan Unilever (HUL) achieved a growth of 22.7 per cent in operating profit to Rs 448.8 crore in the first quarter ended March 31, 2008 over the corresponding quarter last year. Net sales grew 19.1 per cent to Rs 3,793.9 crore year-on-year.

However, the company's net profit dipped 3 per cent to Rs 380.95 crore from Rs 393 crore in the corresponding quarter last year. Last year's profit included an exceptional gain of Rs 59 crore.

Harish Manwani, chairman, HUL, said, "Inflationary pressures are a cause for concern but market growth continues to be strong. There is no evidence as yet of any significant impact on consumer spending in our FMCG categories. We are confident of effectively managing the inflationary challenges."

In spite of a result in line with expectations, its share price on the Bombay Stock Exchange dipped by 1 per cent to Rs 247.2 in a weak market.