Unilever Consumer Care valuation report: fair value BDT 144–351 (Oct 2026)

Investment case: Horlicks volume is falling and margin is 31%; fair value BDT 144-351 against a BDT 1,953 price

Unilever Consumer Care Limited (UCL) is Horlicks in Bangladesh. Health food drinks (Horlicks, Boost and Maltova) were 92.7% of FY2025 revenue of BDT 3.57bn and GlucoMax-D glucose powder the rest [1 p.153]. The company was GlaxoSmithKline Bangladesh until Unilever bought 81.98% of it on 30-Jun-2020 [5 p.119]. It markets no personal-care products: Glow & Lovely, Pond's and Pepsodent are not in its revenue note [1 p.153]. Unilever is paid through four channels: a technology and trademark royalty of about 5.4% of revenue, imports of dry-mix ingredients from Unilever India, services from Unilever Bangladesh, and dividends [1 p.164] [1 p.165].

The business is shrinking in volume and its margin has fallen. Health-food-drink tonnes fell 3.3% in FY2025 and 13.7% in the first half of 2026 [1 p.153] [2 p.13]. The gross margin went from 47.5% in FY2022 to 32.6% in FY2025 [1 p.82] and 31.7% in H1 2026 [2 p.3], as imported milk powder, wheat and malt cost more in taka. H1 2026 EPS was BDT 10.33 against 19.78 [2 p.3]. Interest on BDT 2.6bn of cash and T-bills now makes about a third of pre-tax profit [2 p.2] [10].

We value UNILEVERCL at BDT 144-351 a share, base 229. The base blends a free-cash-flow DCF at a 13.9% cost of equity and 5% terminal growth (BDT 242, 60%) with a dividend discount model (BDT 209, 40%) [10]. About BDT 98 of the base is net cash. The price of BDT 1,952.9 on 29-Oct-2026 [7] is 8.5 times our base and far above our bull case. At our forecast, the price needs a cost of equity of 5.7%, below the 9.27% ten-year government bond yield [9], or an EBIT margin above 100% [10]. The cash flows on their own do not explain the price.

Unilever bought 81.98% from GSK in 2020; group flows equal about half of UCL's revenue

UCL was incorporated as a public company on 25-Feb-1974 and listed on the Dhaka Stock Exchange in 1976 [4 p.106]. For most of its life it was GlaxoSmithKline Bangladesh, marketing Horlicks and Glaxose-D alongside oral-care brands. SETFIRST Limited, the GSK group shareholder with 81.98%, sold 9,875,144 shares to Unilever Overseas Holdings B.V. through the DSE block market. The trade settled on 28-Jun-2020 and the name changed to Unilever Consumer Care Limited from 24-Aug-2020 [5 p.119] [4 p.106]. Oral care (Sensodyne paste and brushes) was discontinued from 30-Jun-2020 [5 p.109] [5 p.119]. GSK confirmed that Unilever may use the trademarks [5 p.119].

The ultimate parent is Unilever PLC; the direct parent, Unilever Overseas Holdings B.V., received BDT 821.6mn of the BDT 1,001.8mn dividends paid in FY2025 (82%) [1 p.163] [1 p.164]. Products are made at a Chattogram site, expanded in 2025, and by a contract manufacturer, Mutual Food Products Limited in Gazipur, which has made UCL's products since 2002 [1 p.80]. Installed capacity is 18,600 tonnes of powder a year; production was 5,634 tonnes in FY2025 (30%) [1 p.164]. A 60% bonus issue in June 2023 took the share count to 19.27mn [3 p.184]. The company has no subsidiaries and one business.

Group flows are large against the company's size. In FY2025 UCL imported BDT 1,260.6mn of materials and finished goods from Unilever India Exports (35% of revenue), paid Unilever Bangladesh BDT 348.9mn for intercompany services (9.8% of revenue) and accrued a royalty of BDT 191.7mn to Unilever IP Holdings [1 p.164]. In H1 2026 the UBL services bill rose to BDT 212.6mn from 123.0mn [2 p.14]. On 29-Jul-2026 the board approved in principle an unsecured loan facility of up to BDT 150 crore (BDT 1.5bn) to Unilever Bangladesh for working capital, for 24 months with drawdowns of up to six months, 'on arm's-length terms', per the company's DSE announcement of 29-Jul-2026 [6]. That is over half of UCL's BDT 2.61bn of cash and investments at June 2026 [2 p.2].

Horlicks tonnes fell 13.7% in H1 2026 after a 13% price rise per kilogram in FY2025

UCL reports tonnes and revenue for its two categories, so we can split volume from price. Health food drinks sold 4,645 tonnes in FY2025 for BDT 3.31bn, an average of BDT 712 a kilogram against BDT 628 in FY2024 (+13.3%) [1 p.153]. The business took two rounds of price increases in 2025 [1 p.22]. Directors' report: Horlicks grew 9.3% in value while 'volume decline was contained at 3.8%' [1 p.80]. Glucose powder fell from 1,298 to 830 tonnes [1 p.153].

The first half of 2026 was weaker. HFD tonnes fell to 1,914 from 2,219 (-13.7%), with the price per kilogram up 4.6% to BDT 737. Glucose volume rose 10.6% to 697 tonnes but at a 7.8% lower price [2 p.13]. Revenue fell 8.4% to BDT 1,604mn [2 p.3]; the company blamed 'degrowth in sales' [2 p.15]. Horlicks' household penetration rose from 15.9% in 2020 to 17.9% in 2021 on small packs [4 p.106]; after three years of price rises, the cheaper packs now carry the volume risk.

Our base has HFD tonnes down 11% in FY2026F (about -8% in the second half on an easier base), then up 1% and 2%. The price per kilogram rises 4.5% in FY2026F and 5% a year after. That gives revenue of BDT 3.34bn in FY2026F (-6.5%) and BDT 3.79bn in FY2028F, still below FY2023's BDT 3.95bn [10].

Horlicks leads health food drinks but revenue fell 14% from FY2021 to FY2025 as shoppers traded down

Health food drinks are malted milk powders mixed with milk or water, bought mainly for children. The company reports a 94.1% share of the category in 2025 against 92.8% in 2024 [1 p.100]; it does not name the data provider, and we found no independent market-size figure (a gap). The share figure says Horlicks dominates branded HFD; it says nothing about substitutes. When prices rise, families can switch to plain milk powder, local malted drinks and other nutrition products, or simply purchase less. The tonnes data show that happening.

Demand is tied to household income. General inflation averaged 8.5% in 2025 against 10.9% in 2024, and 'demand in discretionary packaged food categories remained relatively subdued' [1 p.95]. The company's own plan rests on penetration, innovation, channel design and savings [1 p.96]. Modern trade sales grew 33% and Nutrition Store outlets 12% in 2025 [1 p.22]. Our long-run growth of 5% in nominal taka assumes no real volume growth: revenue fell from BDT 4.14bn in FY2021 to 3.57bn in FY2025 [1 p.98].

UCL is the only listed nutrition-food company in Bangladesh, so the company itself says there is no listed peer [1 p.96]. Other multinational consumer subsidiaries on the DSE trade at 13-30x trailing earnings; UCL trades at 61.5x on filed EPS for the 12 months to June 2026 (BDT 31.76) [8] [6]. We do not use a peer multiple: their figures are not rebuilt from their filings and the businesses differ. Average daily turnover in the last three months was about BDT 0.4mn [7].

Imported dry mix took materials to 59% of revenue; each 10% in taka moves FY2027F EPS about 30%

Materials are the main cost. In FY2025 UCL consumed BDT 2,173.9mn of materials: imported raw materials BDT 1,776.3mn (82%), local raw materials 51.5mn and packing 346.1mn [1 p.154]. The imported part is mostly dry-mix ingredients (DMI) bought from Unilever India Exports [1 p.150] [1 p.164]: blends of milk powder, wheat flour and malted barley. Their taka cost moves with world dairy and grain prices and the taka-dollar rate. A 3% taka move changes profit by BDT 22.4mn, the company estimates [1 p.163]. Customs also raised a BDT 19.5mn demand in 2025 over the HS code used for DMI imports [1 p.165].

Cost of sales rose 22.6% in FY2025 on revenue up 5.5%. The company cites 'higher input prices and continued currency devaluation' and the end of a one-off benefit from reassessing past obligations that cut costs in FY2024 [1 p.81]. Materials and stock change went from 48.5% of revenue to 59.0% [10]. Manufacturing overhead, mostly the conversion fee paid to the contract maker, was BDT 297.6mn [1 p.154].

Our base assumes dry-mix prices rise 3% in dollars in FY2026F and 2% a year after, with the taka weakening 3% a year. Price rises of about 5% just cover that, so the gross margin stays near 30.7%, against 42.0% as the five-year median [10]. We do not assume the old margin comes back: since FY2022 the taka cost of imported dry mix has risen faster than the price consumers accept. We have no primary price series for milk powder, wheat or malt (a gap).

The royalty to Unilever is back at about 5.4% of revenue and BDT 686mn is accrued but unpaid

The royalty is the line most open to the parent's decision. Technology and trademark royalty and technical fees have been under agreement with Unilever companies since November 2020; from January 2022 the royalty is paid to Unilever IP Holdings B.V. In 2023 UCL was granted a one-off waiver, and the royalty was reimposed from the third quarter of 2024 [1 p.165]. The reported charge was BDT 226.4mn in FY2021 and 225.4mn in FY2022 (5.5% of revenue), nil in FY2023, BDT 89.7mn in FY2024 and BDT 25.7mn in FY2025 [1 p.98]. The FY2025 figure is an accrual of BDT 191.7mn (5.4%) less a BDT 166.1mn prior-year adjustment [1 p.165]; H1 2026 was BDT 85.7mn (5.3%) [2 p.3].

Much of the royalty is accrued but not paid. The payable rose from BDT 403.8mn to 600.3mn in FY2025 [1 p.150] and to 686.0mn by June 2026 [2 p.12]. We treat it as debt owed to Unilever and deduct it from the valuation (BDT 36 a share). We model the royalty at 5.35% of revenue in the base and 6% in the bear case; at 7% fair value would be BDT 205 [10].

Tax is simple. The listed-company rate is 20%; the effective rate was 19.1% in FY2025 and 21.9% in FY2024 [1 p.156], and 24.3% in H1 2026 on non-deductible costs [2 p.13]. We use 23.0% for FY2026F and 22.5% after. UCL paid BDT 117 crore to the exchequer in 2025 in duty, VAT and income tax [1 p.81]. The tax authority has an old demand of BDT 17.6mn for 2003-07, under appeal [1 p.165]. Workers' profit participation takes 5% of profit before it. No regulator caps UCL's dividend; Bangladesh Bank's foreign-exchange rules govern how fast royalty and dividends reach the parent.

Five-year record: revenue down 14% since FY2021; interest income rose to 30% of pre-tax profit

From FY2021 to FY2025 revenue fell from BDT 4.14bn to 3.57bn. EPS, adjusted for the 2023 bonus, went from BDT 27.37 to 41.21, with a peak of 49.89 in FY2023, the royalty-free year [1 p.98] [1 p.99]. Three things held profit up while sales fell. The royalty waiver lifted FY2023. Operating costs were cut from BDT 961mn in FY2021 to 429mn in FY2025 [1 p.98]. And interest income rose from BDT 16mn to BDT 299mn as cash was put in deposits and T-bills at higher rates [1 p.98]. Net finance income was 30% of pre-tax profit in FY2025 [10].

Over five years the median gross margin was 42.0%, the median EBIT margin 19.3% (FY2025 excluding the royalty credit) and the median printed ROE 35.6% [10] [1 p.100]. Our FY2027F-28F figures are well below: gross margin 30.7%, EBIT margin 10.3%, ROE 22.7%. The reasons are the lower gross margin, the full royalty and a rebuilt advertising budget. We do not treat FY2021-23 as normal: those years had a 46-47% gross margin before the taka fell, and FY2023 had no royalty.

Payout was 102% of FY2025 EPS; at 100% the FY2026F dividend is about BDT 21

Operating cash flow was BDT 493.8mn in FY2024 and negative BDT 415.2mn in FY2025, because UCL repaid all BDT 573.8mn of usance (UPAS) import credits and took no new ones [1 p.135] [1 p.99]. In H1 2026 it was BDT 580.8mn as inventory fell from BDT 667mn to 384mn [2 p.5] [2 p.16]. Capex is small: BDT 57.1mn in FY2025 [1 p.135]. Cash and short-term investments fell from BDT 3.96bn at December 2024 to 2.74bn at December 2025 and 2.61bn at June 2026 [1 p.132] [2 p.2].

The payout has swung. DPS was 440% of face value for FY2021, 300% for FY2022 and FY2023, 520% for FY2024 and 420% (BDT 42) for FY2025 [1 p.99]. As a share of EPS that is 100%, 79%, 60%, 150% and 102%. The FY2025 dividend took BDT 81.0 crore [1 p.81] and was paid by June 2026 [6]. With cash steady and little capex, we use a 100% payout in the base and 90% in the bear case, giving DPS of BDT 21.49, 21.79 and 23.12 for FY2026F-28F [10]. The FY2026 dividend is paid after the AGM in mid-2027, roughly half the FY2025 level.

Working capital: inventory was 101 days of cost of sales at December 2025 and about 64 days at June 2026 [1 p.132] [2 p.2]. We use 75 days. Trade payables, mostly to Unilever India Exports, are about 9.5% of cost of sales [1 p.150]. Over the last 24 months the capital actions were only cash dividends; there was no rights issue, bonus or bond [6]. The intercompany facility to Unilever Bangladesh would move part of the cash from T-bills to a group loan.

We forecast EPS of BDT 21 in FY2026F, half of FY2025, and BDT 23 by FY2028F

Our base has EPS of BDT 21.49 in FY2026F, down 48%, then BDT 21.79 in FY2027F and BDT 23.12 in FY2028F [10]. FY2026F needs a second half of BDT 11.16 after H1 BDT 10.33 [2 p.3]; the June quarter alone was BDT 4.04. Line by line: revenue -6.5%, 6.1% and 7.1%. Gross margin 30.7%, 30.7% and 30.8%. Advertising rebuilds to 7% of revenue from 6.1% in FY2025 [1 p.155]. Other operating costs are BDT 270-300mn, in line with H1 2026 operating expenses of BDT 271.6mn including advertising [2 p.3]. The royalty is 5.35% of revenue. Net finance income is BDT 210mn in FY2026F on an 8% yield, easing to 7.5% after; the 364-day T-bill cut-off was 8.79% [9]. Tax is 22.5-23%.

The balance sheet follows the same drivers: cash is the plug, inventory 75 days, payables 9.5% of cost of sales, the royalty payable held at the June 2026 level, capex BDT 55-60mn against depreciation of BDT 50-55mn. Against the benchmarks, our FY2026F EPS is -32.3% versus the 12 months to June 2026 (BDT 31.76) [6]. UCL gives no guidance and we found no earnings call or investor presentation in its DSE announcements.

Fair value BDT 144-351, base 229: the price implies a 5.7% cost of equity

The valuation reads off the forecast. DCF (60%): free cash flow to the firm for FY2027F-33F is discounted at the cost of equity (there is no debt) to 31-Dec-2026. The EBIT margin, including other income, is held at the FY2028F 11.0% and growth fades to 5%. The terminal value uses NOPAT x (1 - g / return on new capital) with a 25% return, so reinvestment is 20% of NOPAT. Enterprise value is BDT 2,884mn, 54% from the terminal value. Add cash and investments of BDT 2,673mn; deduct leases, the accrued royalty payable to Unilever and half of the customs demand: BDT 242 a share. DDM (40%): the FY2026F-28F dividends, paid each June, then a terminal value of EPS x (1 - g/ROE) / (CoE - g) at the same 25% ROE, give BDT 209. The DDM is lower than the DCF mainly because it pays out only earnings: the BDT 98 a share of net cash is never distributed, so it is valued below face value. Sum of the parts does not apply: one business, no subsidiaries.

Inputs, set without reference to the price. Cost of equity = 10-year T-bond 9.27% [9] + beta 0.61 x ERP 7.5% = 13.9%. ERP 7.5% is the standard used across this batch for non-bank DSE companies. The raw two-year weekly beta against DSEX is 0.42 (correlation 0.38) [7]; Blume-adjusted it is 0.61, just above the 0.6 floor. Terminal growth of 5% is the low end of the F08 staples range (5-7%), because UCL's revenue shrank 3.7% a year from FY2021 to FY2025 and HFD tonnes are falling. The 25% return matches our FY2027F-28F ROE (22.7%-23.9%) and sits below the five-year median printed ROE of 35.6%, earned on a 42-47% gross margin. At 7% growth and a 9.9% cost of equity the DCF would be BDT 482 (Exhibit 26).

Why the price is so far above. At BDT 1,952.9 the market values UCL at BDT 37.6bn, 91x our FY2026F EPS. Solving our DCF for the price needs a 5.7% cost of equity, below the risk-free rate, or an operating margin above 100%. The stock has traded at 40-74x trailing earnings every December since 2020 [7] [10]: before the floor years (FY2019 20.8x, FY2020 68.1x [5 p.81]), during them and after. That premium does not come from the cash flows we can see. It may reflect scarcity (the only listed nutrition company, an 18% float and BDT 0.4mn of daily turnover) and the possibility of a parent offer for minority shares, about which there is no announcement. We do not put a value on it. A justified forward P/E on our inputs is (1 - g/ROE) / (CoE - g) = 9.0x; our base is 10.6x FY2026F EPS, 9.5% FY2027F yield and 2.4x book.

Risks: dry mix +15% cuts fair value 25%; a 7% royalty cuts it 10%

Each risk below changes one driver in the model, with everything else at base. Input cost is the largest: dry mix 15% dearer in dollars cuts FY2027F EPS to BDT 15.0 and fair value by 25%. A 7% royalty takes fair value to BDT 205. The BDT 1.5bn loan facility to Unilever Bangladesh is a governance and credit risk: if the money earns less than T-bills, or is not repaid on time, finance income and cash fall. Two percentage points less yield cuts fair value by BDT 9 a share. Risks without a modelled number: a parent offer for minority shares or a delisting, at a price we cannot predict; further related-party charges such as the UBL services bill, which rose 73% in H1 2026 [2 p.14]; the customs dispute on the HS code of dry-mix imports [1 p.165]; and management changes (a new managing director from July 2025; a new chairman and head of finance from July 2026) [6]. Liquidity is thin: at BDT 0.4mn of daily turnover, small orders can move the price sharply in either direction.

FAQ

What is Unilever Consumer Care's fair value?

We estimate BDT 144-351 a share, base 229, from a DCF (60%) and a dividend discount model (40%) at a 13.9% cost of equity [10]. The price on 29-Oct-2026 was BDT 1,952.9 [7].

Does Unilever Consumer Care market Glow & Lovely, Pond's or Pepsodent?

No. Its revenue comes only from health food drinks (Horlicks, Boost, Maltova) and glucose powder (GlucoMax-D) [1 p.153].

When did GlaxoSmithKline Bangladesh become Unilever Consumer Care?

Unilever Overseas Holdings bought 81.98% from SETFIRST (GSK) on 28-30 June 2020 and the name changed from 24-Aug-2020 [5 p.119] [4 p.106].

How much royalty does UCL pay Unilever?

About 5.4% of revenue: BDT 191.7mn accrued in FY2025 and BDT 85.7mn in H1 2026; BDT 686mn was unpaid at June 2026 [1 p.165] [2 p.12].

What dividend does Unilever Consumer Care pay?

BDT 42 a share (420%) for FY2025, 102% of EPS; BDT 52 for FY2024 [1 p.99].

Which results does this report use?

The annual report to 31-Dec-2025 and the unaudited H1 2026 statements. The Q3 2026 results were approved on 29-Oct-2026 and will be added when filed.

Sources

1. Unilever Consumer Care Limited Annual Report 2025 (year to 31-Dec-2025) · link · accessed 2026-10-31
2. Unilever Consumer Care Limited unaudited financial statements, six months to 30-Jun-2026 (Q2 2026) · link · accessed 2026-10-31
3. Unilever Consumer Care Limited Annual Report 2023 (share capital and bonus issue) · link · accessed 2026-10-31
4. Unilever Consumer Care Limited Annual Report 2021 (directors' report: history, Horlicks penetration) · link · accessed 2026-10-31
5. Unilever Consumer Care Limited (formerly GlaxoSmithKline Bangladesh) Annual Report 2020 (change of ownership, five-year data 2016-2020) · link · accessed 2026-10-31
6. DSE announcements for UNILEVERCL, Nov-2024 to Oct-2026 (quarterly EPS releases; FY2025 dividend 8-Mar-2026; intercompany loan facility and new chairman 29-Jul-2026; credit rating 20-Apr-2026; Q3 board meeting notice 18-Oct-2026) · link · accessed 2026-10-31
7. AnalystBro price data (TradingView feed): DSE:UNILEVERCL daily, weekly and monthly bars, DSEX weekly, to 29-Oct-2026 · link · accessed 2026-10-31
8. AnalystBro screener: UNILEVERCL and DSE multinational consumer companies, close 29-Oct-2026 · link · accessed 2026-10-31
9. Bangladesh Bank, Treasury auction cut-off yields (10-year bond 9.268% on 25-Oct-2026; 364-day bill 8.79% on 26-Oct-2026) · link · accessed 2026-10-31
10. AnalystBro model for this report (workbook tabs below) · link · accessed 2026-10-31