Hindustan Unilever (HUL) on Monday reported a 21.91% y-o-y increase in its net profit at Rs 1062.31 crore during the October-December quarter.
The maker of Knorr soup and Lux soap said the companys net sales during the period rose 9.38% to Rs 7,037 crore.
During the quarter, the company's domestic consumer business grew 10%, with 4% underlying volume growth.
Announcing the results, R Sridhar, chief financial officer of HUL, said: In a challenging operating environment, FMCG market growth continues to remain slow. Profit after tax before exceptional items grew by 9% to Rs 955 crore while net profit at Rs 1,062 crore was up 22%, aided by exceptional items.
According to Sridhar, the slowdown has impacted both rural and urban sales growth in the Indian FMCG sector for over a year.
With our continued focus on innovation, we have posted 10% increase in domestic consumer business ahead of FMCG markets. Our sales ratio ranges between 45:55 (rural vs urban), driven by competitive intensity, our A&P spend has gone up by 13% at Rs 929 crore, up by 40 basis points," he added.
HULs results follow that of its peers ITC and Dabur both posted double-digit growth in their net profits in the third quarter, despite sluggish economic growth.
Commenting on HULs performance in Q3 FY2014, Abneesh Roy, associate director (research) at Edelweiss Capital, said: HULs sales performance is in line with our expectations and margins are ahead of expectations in spite of higher ad spends.
HULs personal products portfolio revenues increased by 12.4% y-o-y to Rs 2,303 crore.
Harish Manwani, chairman of HUL, said, "Our growth has been competitive and profitable and the results are a reflection of how we dynamically managed the business despite the headwinds in the environment.
On Monday, HUL shares closed up 2.15% at Rs 578.05 on the BSE.