With up to 40 percent upside from the current market levels, most brokerages remain bullish on the stock of FMCG major Hindustan Unilever with a long term 'Buy' rating. HUL shares were trading 1.70 percent lower at Rs 2,427.00 apiece in Friday's trade. The stock was down 5 percent on a year-to-date basis, while it rose 8 percent in the last one year.

HUL reported 9.66 percent year-on-year jump in its March quarter profit at Rs 2,552 crore and 10.9 percent rise in its quarterly revenue at Rs 14,638 crore. The Q4 results missed estimates as CNBC-TV18's poll of analysts had seen the net profit at Rs 2,580 crore.

HUL's management reiterated that an overall volume growth is likely to recover gradually as consumption comes with a lag. It also reiterated that the rural slowdown has bottomed out and it should start seeing volume recovery provided the macro environment and raw material prices remain stable.

HUL's fourth quarter revenue/EBITDA/PAT up 11 percent, 7 percent, and 9 percent year-on-year, respectively, was 2–3 percent lower than most analysts' estimates.

While overall FMCG market volumes were flat, HUL posted a volume growth of 4 percent year-on-year but still ahead of overall FMCG market growth.

Axis Securities believes that HUL’s overall tepid result in the March quarter was a temporary blip and the brokerage expects the company's performance to start seeing an improvement as 75 percent of its business continue to gain market share through premiumisation and driving operational efficiency.

The brokerage maintains a 'Buy' rating on the stock with a target price of Rs 2,800 per share from Rs 3,000 per share earlier. "However, we decrease our FY24/25E PAT estimates by 7 percent/4 percent to factor in near term margin pressure – RM inflation (still above historical level), increase ad-spends," the note stated.

Meanwhile, Nuvama Institutional Equities expects HUL to continue growing ahead of the market. Demand situation is dynamic due to uncertainty around macro environment. However, HUL is well placed in terms of supply chain preparedness. With easing net material inflation, margin profile is expected to continue to improve. The brokerage retains ‘Buy/So’ rating with a target price of Rs 3,377 per share.

HUL Q4FY23 numbers were a miss as rural volumes are yet to show sign of improvement however from a medium to long term perspective, Religare broking believes with improvement in demand and overall volume picking up pace as well as commodity price further inching lower will aid growth.

Furthermore, management believes near term growth to be volatile while they are positive from a medium term perspective.

Motilal Oswal maintains a positive outlook on the stock based on HUL's continued market share gains in a challenging consumption environment. HUL's focus on driving premiumisation across categories is standing it in good stead. "We reiterate our BUY rating on the stock with a TP of Rs 3,010," it stated.

The company has also declared a dividend of Rs 22 per share for FY23. Together with an interim dividend of Rs 17 per share, the total value for the year amounts to Rs 39 per share, an increase of 15 percent as against FY22.