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RETAIL (NON-INTERNET/MOBILE) | Grocery
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Founded Year

1859

About A&P

A&P is a supermarket store chain. The company offers groceries, tea, coffee, vegetables, frozen foods, meat, and other related products. It is based in Montvale, New Jersey.

A&P Headquarter Location

2 Paragon Drive

Montvale, New Jersey, 07845,

United States

Latest A&P News

Steep price hikes, cut in A&P lifts HUL’s finances in Q3

Jan 20, 2022

Steep price hikes, cut in A&P lifts HUL’s finances in Q3 Steep price hikes, cut in A&P lifts HUL’s finances in Q3 An average price hike of nearly 8 per cent over a meagre 2 per cent volume growth boosted top-line, while 14 per cent cut on promotional expenses improved margins. Steep price hikes, cut in A&P lifts HUL’s finances in Q3 Updated Jan 20, 2022, 7:32 PM IST Reeling under the influence of massive inflationary pressure, fast moving consumer goods (FMCG) major Hindustan Unilever (HUL) resorted to steep price hikes and cost management during the October-December quarter to maintain its growth momentum. These measures, according to the top management of the firm that markets widely popular household brands like Lux soaps, Surf Excel detergents and Kissan jam, helped in gaining market share amid unfavourable conditions. HUL reported a 17 per cent year-on-year (YoY) jump in its net profit for quarter-ended December 2021. Its profit after tax for the quarter grew to Rs 2243 crore from Rs 1,921 crore. Cost of materials consumed rose 13.3 per cent -- much higher than its 10.4 per cent top-line growth -- to Rs 3,875 crore. However, a significant cut in its advertising and promotional (A&P) expenses saved the day for HUL. By cutting its A&P expenses by over 14 per cent -- from Rs 1,388 crore to Rs 1,189 crore -- the company managed to keep its margins healthy. In fact, at 25.4 per cent, its earnings before interest, tax, depreciation and amortisation (EBITDA) margin improved by 100 basis point over the corresponding quarter last year. While its net profit margin improved to 17.39 per cent during the December 2021 quarter -- up from 16.44 per cent during the year ago period. In the quarter, the country’s largest non-tobacco FMCG company’s net sales grew 10.4 per cent YoY to Rs 12,900 crore. While it posted a meagre 2 per cent underlying volume growth during the quarter, implying the steep price hikes that it had affected to keep pace with the rising cost of commodities and to maintain its top-line growth. According to Sanjiv Mehta, chairman and managing director, HUL, downward adjustments in grammage in smaller pack sizes significantly impacted its volume uptake during quarter. “Instead of raising prices of a Rs 5 pack to Rs 6, we usually titrate the volume. Nearly 30 per cent of our portfolio is in that zone. Thus, it impacted volume growth,” he said in a post-earnings briefing. Citing data from market research firm Nielsen, Mehta said the slowdown in the rural market has turned severe. Unlike earlier, when the rural market was growing faster and at over 12 per cent, in December quarter the market has shrunk in volume terms -- registering a negative growth. “These are unprecedented times. The kind of inflation we are now observing, we have not seen the same in many years. There are a large number of consumers, who have limited income and would, thus, adjust their volume consumption as per their budget”, said Mehta. According to him, under the circumstances, HUL’s performance has been superior than the industry. “We have not only gained market share but have also managed to grow at double the pace the industry has grown during the quarter”, he added. The steady decline in purchasing power of rural households needs to be addressed. And for the same, Mehta has sought increased government spending. “The only way to lift purchasing power of rural consumers is to give more money into their hands. I believe that all the relief provided by the government in the last two years to the rural consumers, is to get extended in FY23. Government outlay in schemes like MGNREGA and free food supply may be increased. The economy is still in process of recovering. There are still disruptions. So, government would have to take measures to spurt demand, private consumption”, he said. Overall, HUL’s performance remained at par with the street estimates. Brokerages like HDFC Securities, ICICI Direct and Axis Securities had estimated an 8-10 percent rise in its top-line, while net profit in the range of Rs 2,170 crore to Rs 2,320 crore. According to Edelweiss Securities, cut in A&P expenses was a prudent measure while its price hikes is evidence of its pricing power.

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A&P Patents

A&P has filed 10 patents.

The 3 most popular patent topics include:

  • Engine technology
  • Engine components
  • Engine fuel system technology
patents chart

Application Date

Grant Date

Title

Related Topics

Status

9/12/2019

11/2/2021

Engine fuel system technology, Engine technology, Fuel injection systems, Engine components, Marine engine manufacturers

Grant

Application Date

9/12/2019

Grant Date

11/2/2021

Title

Related Topics

Engine fuel system technology, Engine technology, Fuel injection systems, Engine components, Marine engine manufacturers

Status

Grant

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