Maintain 'HOLD' on Hindustan Unilever – TP Rs.575 - Geojit BNP Paribas

- Although Q2FY13 earnings were marginally disappointing, the underlying secular business trends still remain healthy.

- Operating profit growth (18%, FY13-15 CAGR) is expected to remain strong, supported by a healthy pace of innovation and an improved competitive position.

- Market development opportunities in both urban (premiumisation) and rural (penetrating and up-trading) still remain substantial, as distribution is much improved and brand positions are much more competitive.

- Margin trends are expected to remain positive supported by improved product mix.

- Valuation seems to be rich at current levels of Rs.540 and we maintain Hold recommendation on the stock, but would use any significant weakness to accumulate shares.

Source : Equity Bulls

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