Hindustan Unilever shares sink on rice export divestment plan
YUI NAKAMURA, Nikkei staff writer
SINGAPORE -- Hindustan Unilever stock declined Friday in Mumbai on news of the company's plan to sell its rice exporting business.
The Indian consumer goods leader said after market close Thursday that its rice export operations would be sold to the LT Foods group. Investors reacted to the potential hit to Hindustan Unilever's earnings. The stock dropped as much as 1.26% Friday before ending at 846 rupees, down 0.39%.
The deal, estimated at 250 million rupees ($3.76 million), covers brands such as Gold Seal Indus Valley.
The Indian unit of Anglo-Dutch company Unilever considers the move as part of efforts to concentrate resources on core operations, saying it will continue to carry out a growth strategy in the food business. Hindustan Unilever launched the rice exports in 1985 and ships to markets such as the Middle East and Europe.
Hindustan Unilever in September announced a divestment of bread-making unit Modern Foods Industries to another company.