The fast moving consumer goods company reported a fall in net profit due underlying volume growh of 4% in the domestic market. According to Harish Manwani, chairman, there are near term concerns for HUL particularly around slowing market growth
Hindustan Unilever, one of India's leading fast moving consumer goods company reported 23.4% decline in its first quarter net profit to Rs1,019 crore. This was due to significant exceptional income generated in from the sale of properties during the quarter last year.
Harish Manwani, chairman of HUL, said, “While there are near term concerns particularly around slowing market growth, we are confident of the medium to long term growth prospects of the FMCG sector and our strategy of driving growth and profitability through innovation and operational excellence.”
Net sales grew 7% during the quarter ended 30 June 2013 to Rs6,687.5 crore compared with Rs6,250.15 crore during the corresponding quarter last year, driven by growth in foods and domestic consumer business.
During the quarter, HUL’s domestic consumer business grew competitively at 7% with 4% underlying volume growth ahead of market. The home and personal care division grew 5.9% while foods business grew 12.5%.
Soaps and detergents grew 8%, which saw broad based growth; personal products grew 2% in a slowing market; beverages grew 16%, helped by acceleration in tea segment; packaged foods grew 5%, driven by Kissan & Knorr Soups. Higher competition drove up advertising & promotion slightly up to Rs70 crore, up 20 basis percentage points, in the quarter.
Hindustan Unilever closed Friday 3.4% down at Rs663 on the BSE, while the benchmark Sensex ended the day marginally down at 19,748.
PNB shares fell sharply due to a spike in its gross NPAs during the June quarter, raising concerns about its asset quality. According to a brokerage, half of the Bank's NPAs are from gems and jewellery sector
Punjab National Bank (PNB) shares hit its four-year low to Rs584.4 on Friday due an increase in its non-performing assets (NPAs) during the June quarter. On 12 June 2009, PNB shares closed at Rs594.95 while it hit its all-time high to Rs1,384.35 on 9 November 2010 on the BSE. Although the lender reported 2.3% growth in its June quarter net profit, its deteriorated asset quality, especially exposure to gems and jewellery has emerged a cause of concern for the state-run Bank.
During the quarter to end-June, PNB said its gross NPA, as a percentage of advances grew to 4.84% from 3.34% same period last year. During the March quarter, its gross NPA was at 4.27%.
"On the asset quality front, the bank found no respite on asset quality pressures, as slippages during the quarter came in at Rs3,594 crore, almost half of it contributed by a single exposure to gems and jewellery sector. Consequently, the bank's gross NPA levels jumped up sequentially by 12%," said a brokerage in a note.
During the first quarter, PNB said its net profit increased 2.3% to Rs1,275 crore from Rs1,246 while net interest income (NII) grew to Rs3,908 crore from Rs3,693 crore, same period last year. The lender reported total revenues, including NII, of Rs11,746.6 crore, a marginal increase from Rs11,721.97 crore same quarter a year ago.
PNB closed Friday 5.2% down at Rs595 on the BSE, while the 30-share Sensex ended marginally down at 19,748.
In a strange case, the TPA of United India approved cashless hospitalisation as per a package rate for preferred provider network. But the network hospital billed the insured more than 120% of the approved amount, making a mockery of PPN package
Moneylife Foundation Insurance Helpline received an email from Jyothi Gopal (name changed) about a strange case. United India Insurance third party administrator (TPA) Vipul MedCorp approved a cashless expenditure for her of Rs25,000 for appendicitis surgery. But United’s preferred provider network (PPN) New Hope Indian Speciality hospital billed the insured for Rs65,368.
“I have taken United India Insurance Family Medicare Policy. My son developed sudden stomach pain in June 2012 and had to undergo surgery for appendicitis immediately. I have a floating insurance cover for Rs5 lakh. Though I had insurance cover with same company for almost 12 years, I never approached the company for a single claim. The network hospital billed us for Rs65,368 for the surgery and TPA approved cashless only for Rs 25,000. I made several representations to TPA - Vipul MedCorp and sent many mail communications, visited them and visited United India branch several times. But they kept on dragging the issue. Finally, they sent me a claim repudiation letter in January 2013. I approached United India divisional office three months ago. But, they have informed me that I should approach Ombudsman office as they are helpless since TPA refuses to oblige.”
The question is what is the purpose of the insured going to network hospital if the TPA/insurer approves cashless for less than half of the hospital charges? If the TPA/insurer has really negotiated the package rates with the network hospital, the insured does not have to pay from own pocket.
Vipul MedCorp’s cashless authorisation letter clearly states that the approval for cashless is as per PPN package rate. It adds, “Hospital must collect the excess amount directly from the beneficiary (NOT APPLICABLE FOR PACKAGE RATES).” What is the purpose of TPA letter specifying these words in highlighted capital letters? The case shows that the purpose of PPN hospital is defeated. Why does the insured have to suffer?
Ms Gopal is one of many such victims of partial claim settlement even after availing of services in a network hospital. The hospital room rent was within the limit for the policy and the appendicitis surgery does not have any sub-limit. What is the value add provided by TPA if there is a colossal difference in what it agreed with the PPN hospital for package rates and what the hospital is charging the patient? Why is New Hope Indian Speciality hospital even part of the Government insurance companies PPN?
According to one insurance broker firm, “The true value of a package with network hospitals is that the TPA / Insurers ensure that they charge as per the agreed package rate. They should not make the insured pay the difference between hospital actual charge and package rate. Where the insured is made to pay such difference he is entitled to have the same reimbursed by the TPA / Insured if there is no sub limit in the policy.”
New Hope Indian Speciality hospital bill includes surgeon’s fees of Rs15,000, assistant surgeon fees of Rs5000 and anaesthetist fees of Rs5000, which itself equals the TPA package rate of Rs25,000 for appendicitis. Who is supposed to pay for the hospital bill charges for room, operation theatre, medical supervision, nursing charges, lab charges, pharmacy, doctor visiting charges, laparoscopy charges, ECG and Injection? The TPA and hospital agreement for package rates seems to be just a farce.
Moneylife wrote to TPA Vipul Medicare as well as United India Insurance officials, but there was no response. Can Insurance Regulatory and Development Authority (IRDA) help to ensure that hapless mediclaim policyholders are not taken for a ride due to package rates disagreement between TPA/insurer with its own PPN hospital?
It’s an irony that financial advisors tell customers to buy adequate mediclaim cover as part of proper financial planning. The customer buys Rs5 lakh cover thinking that they have covered their risk. But after paying premium for 12 years, the policyholder is repaid with a nasty surprise of TPA/insurer paying less than half of the hospital bill.
The question that United India should introspect is whether it would have treated corporate mediclaim customer the same way? Corporate mediclaim customers are often rolled a red carpet with additional benefits like maternity and cashless treatment at hospitals where retails customers are kept out. It is because a retail customer does not have any bargaining power. The insurer gives a damn if the policyholder wants to renew the policy or not.
Ms Gopal alleges that the divisional office of United India stated that they are helpless since the TPA refuses to oblige. If true, then it is nothing but a mockery of the system. When did the TPA become so powerful that they can overrule the insurance company which employs them? Hopefully, TPA’s will be cut to size soon since the new health insurance guidelines to be implemented in October 2013 by keeping them away from claims settlement. Insurance companies will be made answerable to the reasons for claims denial/partial settlement. They can no longer hide behind the veil of TPA.