UNILEVER INVESTOR EVENT 04 DEC 2018 Sanjiv Mehta, Chairman & Managing Director Hindustan Unilever Limited
INDIA’S LARGEST FMCG COMPANY 2 2
Hindustan Unilever Limited : € 4.5bn powerhouse HUL performance Our footprint Recognition ‘Dream Employer’ for 9 10% CAGR over years in a row among 10 years* top Indian universities Nearly every household uses one or more of our brands 530 bps EBIT improvement #8 Globally and #1 in India Among the top 5 most Our brands are valuable companies in available in 13 HUL brands India with market cap 8mn+ stores in India’s Top 50 Most of $51b** Trusted Brands 3 *HUL performance as per India local reporting ** Market capitalization converted to USD based on rate as of 22 nd Nov 2018
Consistent high performance across Divisions A few examples in the last 6 years Beauty & Personal Care Home Care Foods & Refreshment* Hair Fabric Solutions Tea Turnover Market Share Profitability Turnover Turnover Profitability 1.8x 2.0x 1.9x ~ 700 bps 1.8x 3.7x Largest Tea Largest Beauty & Personal Care Largest Home Care company in India company in India company in India * On completion of merger with GSKCH, our F&R business will become one of the largest in the country 4 All nos are basis internal management reporting & compared with FY’11 - 12. Market share increase is as of MAT Sep’18
Our strategy is anchored around.. Underpinned by Growth Unilever Sustainable Living Plan Consistent, Competitive, Profitable, Responsible Growth 5
Strategy in action Building Blocks Strengthening Creating categories Driving Fuel for Execution the Core premiumization of future growth Excellence Enabled by Structure Capabilities Culture Being Future Fit 6
Strategy in action Building Blocks Strengthening Creating categories Driving Fuel for Execution the Core premiumization of future growth Excellence Enabled by Structure Capabilities Culture Being Future Fit 7
Our Core portfolio Straddling the price-benefit pyramid For e.g. Hair Rs. 432 High end naturals ($5) Salon care Anti-dandruff Daily damage care Mass beauty Sachet at Family Re.1 (1.5 US cents) 8
Strengthening the Core Focused SKUs at Making the Core more Constantly innovating Focus on driving aspirational through and renovating deaveraged level penetration & using local insights weighted distribution purpose led brands the Core 9
Building iconic engagement platforms Lakmé Fashion Week Fair & Lovely Foundation Lifebuoy Help a child reach 5 Lux Golden Rose Awards Red Label taste of Rin Career Academy Surf Excel Haar ko Harao togetherness Kissan Tiffin Time Table 10
Innovations driving our growth 11
Our Market development portfolio Nascent categories penetration Hand Wash* 22 Instant Coffee Face Wash Body Lotion Washing Liquids Hair Conditioner Soups* Dishwash Liquids Body Wash* 2 12 Source: IMRB As of MAT Aug’18 (Urban + Rural) ; *Urban only.
Creating categories of the future Market development model Driving category penetration Growing at ~ 2x of 20% HUL average of Business SEED ACCELERATE EXPLODE 2.2 x Doubled in size in the last 5 years UPTO 10% 10% TO 20% 20% AND ABOVE CATEGORY PENETRATION 200 million consumer contacts 13
Leading with trends Naturals Perfume on the go Fabric sensations Health Reinvent Indian look Male grooming 14
Driving Premiumization Market growing faster in the premium segment Example : Fabric Solutions HUL share HUL share Price 2017 of segment* of segment* 3.5x Premium 28% 1.3x Premium 3.0x Mid 39% 1.2x Mid 1.5x 2.0x Mass x Mass x 33% x *Source: Nielsen MAT Sep’18 (Urban + Rural) 15
Fuel for growth End-to-end cost focus Powered by Savings 1.7x Non Material Materials Supply Chain Costs x Return on Overheads Marketing 2014 2015 2016 2017 Investments % of Turnover Organization wide Crowd sourcing of Driving virtuous effort ideas cycle of growth 16
Execution excellence Front end execution Speed to market Agile Supply Chain Inventory days Service 1.8x x 0.6x Faster landing of Effective x +1000bps x innovations 55 0.94 Coverage* 0.92 2015 2018 50 2015 2018 0.9 0.88 No. of days 45 0.86 0.7x 1.7x 0.84 Art of pricing 40 0.82 0.8 35 x Assortment 0.78 30 0.76 2015 2018 2015 2018 Driving high customer service Leveraging analytics to drive better while optimizing inventory coverage and sharper assortment 17 * Effective coverage is measured as no. of outlets with monthly average billing >INR 500 ($7.0); 2018 nos are as of Oct’18
India is a heterogenous country Diverse Varied affluence Different media Differential category demographics levels habits adoption Multiple languages LSM 7+ = 8% nationally Penetration in adjacent Mobile internet penetration: 8 Major religions states also not the same (Range of 5-48%) Rural- 18%*; Urban- 59%* 18 *A report published jointly by the Internet and Mobile Association of India (IAMAI) and KANTAR- IMRB: March’18
Customer Development Sharper strategy leveraging Traditional trade channels Building channels of the ecosystem will remain relevant the future Demand Capture Wholesale Right outlets, Right Aids Width of frequency, Right distribution assortment Modern Trade - Driving visibility Retail Demand Fulfill Accessibility at On time delivery at arm’s reach of optimal cost desire Explode Ecommerce - Partnerships and exclusive ranges Shakti Demand Generate World class in store Deep rural Growth and profitability in execution distribution E-Com > Modern Trade > Traditional Trade 19
Strategy in action Building Blocks Strengthening Creating Categories Driving Fuel for Execution the Core premiumization of future growth Excellence Enabled by Structure Capabilities Culture Being Future Fit 20
Winning in Many Indias WiMI in action From 4 branches to Distinctive strategy 14 consumer at a cluster level clusters Empowered Cluster Customized product Heads enabling propositions & faster decision media deployment making closest to for every cluster the point of action WiMI is a competitive edge for HUL 21
Winning in Many Indias – few examples Pricing and proposition in fabric solutions Product in Refreshment Proposition in face care Low penetration markets Punjab and Uttar Tamil Karnataka Pradesh Nadu Majority mid Majority mass Grow by removing barriers of proxy usage Designed for color and Other markets taste preference Upgradation through Upgradation through mid and premium bars top end formats – Leverage by increasing and powders Matic liquids usage occasions 22
C4G in action Country Category Business Team : 15 Mini – Boards Functions in a CCBT Empowered to More consumer & Land bigger, faster deliver in-year P&L customer centric innovations Liberating HUL Leadership Team to focus on longer term goals, Merger of brand building exploring inorganic growth opportunities and managing disruptions and brand development 23
Digital trends shaping India Exponential data growth Rise of vernacular content Rapidly evolving digital Rs. 205/GB infrastructure in 2016 Plummeting data costs driving 480+ million internet increased usage 3 rd largest start-up users with more (4 hours video per day) ecosystem in the world mobile viewers Rs. 19/GB in 2017 Data Sources: Decoding Digital Impact; 2017 Report by BCG & Google; YT data extracted in April 2018 24 Kantar IMRB Internet Report 2016, 2017; 2017 KPMG Google Report on Indian Languages – Defining India’s Internet
Leading the disruption along our value chain AI Augmented Digital Factory Robotics Automation @ Digitization of Stores Precision Marketing Decision Making & Robotics Warehouses Distribution Store Consumers Distributor Factory Performance Center Management B2B Model and assured N+1 Delivery Harnessing the power of ‘Data as an enterprise asset’ 25
Winning culture: Focus on Wellbeing, Diversity & Inclusion Nurturing an Building an Inclusive Holistic Wellbeing experimentation culture Workplace +1200 bps Distinctive Technology giving improvement in Competitive Advantage gender balance Embracing inclusion beyond Appropriate Consumer gender and Large Part Need/ Unmet breaking Problem of the Value People with Physical and Chain stereotypes purpose mental wellbeing 26
UNILEVER SUSTAINABLE LIVING PLAN
Unilever Sustainable Living Plan Health & Wellbeing Enhancing Livelihoods Sustainable Sourcing Thought Leadership 90,000+ Shakti 450 billion 100% tomatoes entrepreneurs litres are sourced from network of water saving sustainable potential sources created 1.7 million people >67 million people reached - benefitted Lifebuoy Handwashing 100% of our Programme plastics Over 420,000 52% tea is packaging to 83 billion litres of safe people trained sourced from be reusable, drinking water provided by estates recyclable or Pureit certified as compostable sustainable ~1.1 million people impacted by 2025 600,000+ women through Domex Toilet enrolled Academy 28
Recommend
More recommend
