Hind Lever hit by price war concerns

DALAL STREET SPIKES

FMCG major Hindustan Lever plunged 5.29 per cent on aggressive institutional selling. According to market sources, the counter witnessed selling pressure amid fears of disappointing quarterly results after the recent price war in the detergent segment.

"Price cut in detergents may probably lead to a sharp fall in the HLL's profit margins in the coming quarter," an analyst said. The stock in the intra-day trades touched a low of Rs 145.60 before closing at Rs 146.80 with huge volumes of 19.81 lakh shares registered at the BSE.

The stock since its fourth quarter results has plunged more than 37 per cent from Rs 202.50 on February 13 to today's close of Rs 146.80. For the quarter ended December 31, 2003, HLL posted a marginal 2.94 per cent rise in net profit to Rs 494.72 crore.

However, the soaps and detergent segment, which accounts for a major part of the company's revenues, witnessed a 3 per cent fall to Rs 1,095.33 crore. The margin for the quarter remained flat, a 7 basis point drop to 23.62 per cent, from 23.69 per cent.