Hindustan Unilever shares: Should you buy at current market price?

Despite the slowdown, HUL posted a 21 percent YoY rise in net profit at Rs 1,848 crore for the quarter ended September 2019. Its revenue came in at Rs 9,852 crore, up almost 7 percent YoY over Rs 9,234 crore in the same quarter in 2018.

From stock market investors’ viewpoint, the current market levels present a good buying opportunity as, despite consumption slowdown, Hindustan Unilever shares gave a little over 15 percent return, mildly below the Sensex return of 15.4 percent in the last one year.

Considered a safe bet, the three-year return on the FMCG stock is a healthy over 146 percent and the 10-year return on the scrip is a strong over 690 percent. During the same period, the Sensex returned 53 percent and 138 percent, respectively.

Brokerage firm Anand Rathi has raised its target price on the stock to Rs 2,422, expecting a return of 21 percent in the near term.

"While current macro-economic conditions are likely to keep subdued demand in the near term, we remain optimistic that the company will outgrow the industry. HUL being the largest FMCG company with one of the largest footprints in terms of products and distribution network and its strategy to target volume growth, should drive healthy growth in the medium to long term. At CMP the stock is trading at 69.0x FY20E EPS and 60.0x FY21E EPS. We recommend buy on the stock with a target price of Rs 2,422 per share," it said in a recent research report.