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HLL 99-00 net up 32 pc to Rs 10.69 billion

Hindustan Lever Limited has posted a net profit of Rs 10.699 billion in the year 1999, a growth of 32.8 per cent over the previous year.

HLL's board of directors met in Bombay today, and recommended a final dividend of Rs 17 per equity share which taking together with interim dividend of Rs 12 per share, makes a total dividend of Rs 29 per share. This represents a growth 31.8 per cent over the total dividend of Rs 22 for the previous year.

Total turnover of the company grew by seven per cent to Rs 101.42 billion during the year.

Profit before tax and profit after tax at Rs 13.88 billion and Rs 10.69 billion reflected a growth of 22.8 per cent and 27.8 per cent respectively.

Improved profitability through lower consuming cost, supply chain savings, better efficiencies and optimal investment of surplus fund resulted in profit growth by over 13.7 per cent during the year as compared to 11.9 per cent the previous year.

Earnings per share was Rs 48.62 as compared to Rs 36.70 in 98-99.

The board also recommended the split of its Rs 10 share into 10 shares of rupee1 each today.

The board decision will be subject to approval by the share holders at the annual general meeting of the company.

The splitting of shares will lead to a reduction in the stock price to one-tenth of the current price and in turn attract more retail investors who are now not in a postion to buy shares.

Investors already have the option to buy even a single share, as HLL is in the compulsory dematerialisation list. They would now have the added advantage of a lower market price.

Market sources said that this will help achieve better valuation in the market and boost market capitalisation.

HLL's move is in line with that of IT majors like Infosys and Wipro and entertainment and media major Zee Telefilms. Ever since the shares of these companies have been split up, their market prices have gone up sharply. Wipro was the first company to comple a stock split in the ratio of 5:1.

Meanwhile, at the BSE, the HLL share opened at Rs 3136.55 and after hovering between Rs 3,078 and Rs 3,136.55, till noon showed a gain of Rs 164 from the previous close of Rs 2904.25.

In the last three days since the announcement of split in shares, HLL shares gained by Rs 389 to Rs 3,078 till noon.

In an unrelated development, M S Banga has been appointed the successor to Keki Dadiseth, chairman, HLL. Dadiseth will move to parent Unilever's executive committee (global headquarters). Banga has had a stint in Unilever's London office. Earlier, he held various positions in HLL.

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