HUL, GSK terminate agreementHINDUNILVR - 2576 Change: -26.25 (-1.01 %)
Hindustan Unilever (HUL) and GSK Consumer have mutually decided to terminate the distribution agreement of GSK Consumer´s over-the-counter (OTC) products that include Eno, Crocin, Iodex, Sensodyne by November 2023, This agreement ends 1.5 years ahead of the agreed period.
HUL is earning distribution income by distributing GSK consumer's products. We believe the distribution income of ~ Rs 250 pa is part of other operating income for HUL. The termination of distribution contract would impact earnings by ~2% for the company. However, this would also eliminate the complexity of distributing GSK's oral care product