Mumbai, July 26: India continues to be a major hunting ground for top executives at Unilever Plc.
Nitin Paranjpe, managing director and chief executive of Hindustan Unilever Ltd (HUL), is being elevated as the global head of the parent’s home care business.
Consequently, Sanjiv Mehta, currently Unilever’s chairman for North Africa & Middle East (NAME), has been appointed as the managing director and chief executive officer of the Indian entity. Mehta will replace Paranjpe with effect from October 1.
A press statement from the FMCG giant said Paranjpe would join the Unilever Leadership Executive (ULE), taking on the role of president, home care.
The ULE is responsible for delivering growth across the parent’s regions, categories and functions.
This is not the first time that a chief executive at Hindustan Unilever has been elevated to the global stage. Vindi Banga, who was appointed chairman and managing director of the company in 2000, took the role of president, home and personal care — Asia, in 2004.
In this role, he was responsible for a 7-billion-euro business across North East Asia, China, South East Asia, Australasia and South Asia, including India. In 2005, Banga joined the Unilever executive board as president, foods.
Similarly, Harish Manwani, who is now the chairman of Hindustan Unilever, was earlier a member of the Hindustan Unilever board (then known as Hindustan Lever Ltd) in 1995 as director responsible for the personal products business.
In 2000, he moved to the UK as senior vice-president, global hair care and oral care. In 2001, he was appointed president, home and personal care for the Latin America business group.
In 2004, he was appointed president and CEO of the HPC North America business group, and in April 2005 joined the Unilever Executive as president, Asia Africa.
Then there is Ashok S. Ganguly, who was the chairman of HLL from 1980 to 1990, and later went on to become a member of the Unilever board of directors from 1990 to 1997.
The current management changes were announced on a day Hindustan Unilever disappointed the Street with a volume growth of 4 per cent against the analysts’ estimate of 6 per cent. In the corresponding quarter of last year, Hindustan Unilever had posted a volume growth of 9 per cent.
Hindustan Unilever said its profit after tax before exceptional items stood at Rs 885.13 crore, up from Rs 854.58 crore in the same period last year.
The actual net profit was down 23.4 per cent at Rs 1,019.25 crore against Rs 1,331.19 crore in the same period last year. This was primarily because of lower profits from the sale of surplus properties at Rs 106.25 crore in the quarter against Rs 607.24 crore a year ago. Total income during the quarter rose to Rs 6,809.04 crore against Rs 6,378.77 crore in the same period of 2011-12.
Announcing the second-quarter numbers on Thursday, Unilever had cautioned that growth was slowing in emerging markets “as macro-economic headwinds influence consumer behaviour”.
“We are seeing a slowdown in market growth in both volume and value terms, and over the next 2 to 3 quarters these challenges will continue,” said chief financial officer R. Sridhar.
Chairman Harish Manwani said: “In a difficult market environment, we have again delivered competitive growth and strong margin expansion through a sustained focus on innovation, in-market execution and robust cost management.” He, however, said there were near-term concerns because of a slowing market.
Ritwik Rai, FMCG analyst at Kotak Securities, said the weakness in volume growth at Hindustan Unilever was largely attributable to the personal products segment, concentrated largely in skin care.
On the BSE, the Hindustan Unilever stock fell 3.38 per cent to Rs 663.30, recovering slightly at the close after tumbling to a day’s low of Rs 647.70.
On Wednesday, parent Unilever Plc had announced that its turnover rose just 0.4 per cent to euro 25.5 billion (£19.4 billion). Pre-tax profit gained 14 per cent to euro 3.6 billion.
Sales in emerging markets surged 10.3 per cent, while those in developed markets shrank 1.3 per cent in the second quarter.