Morgan Stanley has maintained its equal-weight rating on Hindustan Unilever Ltd (HUL) with a target price of ₹2,335, flagging near-term weakness due to the impact of GST cuts on trade inventory and consumer behaviour.
The brokerage said consolidated growth is likely to remain flat to low single digits, compared with 5% in Q1FY26 and 2% in Q2FY25. GST-related price reductions have led to transitory disruptions as trade channels clear old inventory, while consumers have delayed pantry purchases, hurting September and October sales.
However, Morgan Stanley expects recovery to begin in November as pricing stabilises and consumption normalises. It added that while the cuts may create temporary challenges, HUL’s long-term growth trajectory remains intact.
Disclaimer: The views and recommendations made in this article are those of Morgan Stanley. This article does not constitute investment advice. Investors should consult their financial advisors before making any investment decisions.
