Hindustan Unilever Limited
Report on the Audit of the Standalone Financial Statements
1. We have audited the accompanying standalone financial statements of Hindustan Unilever Limited ('the Company'), which comprise the Standalone Balance Sheet as at 31 March 2026, the Standalone Statement of Profit and Loss (including Other Comprehensive Income), the Standalone Statement of Cash Flow and the Standalone Statement of Changes in Equity for the year then ended, and notes to the standalone financial statements, including material accounting policy information and other explanatory information.
2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 ('the Act') in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards ('Ind AS') specified under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2026, its profit (including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
3. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India ('ICAI') together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
4. Key Audit Matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
5. We have determined the matters described below to be the key audit matters to be communicated in our report.
Key Audit Matters
How our audit addressed the key audit matters
Revenue Recognition - Discounts and Rebates
Our audit procedures included, but were not limited to,
(Refer Notes 2 and 25 to the standalone financial
the following:
Statements)
• Assessed the appropriateness of the Company's revenue
The revenue of the Company consists primarily of sale of products through various distribution channels.
recognition accounting policies, including those relating to discounts and rebates in accordance with Ind AS 115;
Revenue is recognised net of variable consideration
• Evaluated the design and tested the operating effectiveness
i.e. incentive schemes, trade and volume discounts
of the Company's key internal controls, including general
and other rebates as described in the aforesaid notes
and specific information technology controls, exercised
(hereinafter referred to as 'discounts and rebates').
implemented by the management for measurement and
Accrual towards discounts and rebates at the reporting
recording of such discounts and rebates;
date with respect to ongoing discount and incentive
• On a sample basis, inspected key customer contracts
schemes is complex due to varying terms and
and incentive schemes to understand the terms and
conditions, multiplicity of products, channel partners
conditions pertaining to discounts and rebates and
and markets. Significant judgments are required to
evaluated the process followed by the management to
be made by management in order to determine
determine the amount of accruals as at year end;
variable consideration in accordance with Ind AS 115, 'Revenue from Contracts with Customers' (”Ind AS 115”), particularly in estimating accruals relating to incentive schemes that are based on secondary sales made by the customers of the Company.
• Performed substantive testing on selected samples of discounts and rebates recorded during the year as well as those recorded through year-end provisions recognised by the Company, by testing relevant approvals and underlying supporting documents in
respect of such schemes and customer contracts;
The above complexity leads to a risk of revenue
•
Performed analytical procedures on discounts and
being misstated due to inaccurate estimation of such
rebates during the year to identify unusual variances;
discounts and rebates, and hence, it requires significant
Tested accuracy of management judgements in
auditor attention.
estimating discounts and rebates accruals;
Considering the materiality of amounts involved and
Tested, on a sample basis, the manual journal entries
significant management judgements required in
posted to revenue relating to the discounts and rebates
estimating the accrual of discounts and rebates, this matter has been considered as a key audit matter for
to identify unusual items, if any; and
the current year audit.
Evaluated the appropriateness and adequacy of related disclosures in the standalone financial statements in accordance with applicable accounting standards.
Impairment assessment of Foods - Cash Generating
Our audit procedures included, but were not limited to, the
Unit (Foods CGU)
As disclosed in Notes 2 and 4 to the standalone
following:
financial statements, the Foods CGU includes goodwill
Obtained an understanding of the management process
and intangible assets (having an indefinite useful
for annual impairment assessment, and assessed the
life) aggregating H17,265 crores and H27,228 crores,
appropriateness of the Company's accounting policy
for impairment of non-financial assets in accordance
respectively, which cumulatively represents 57% of total assets of the Company as at 31 March 2026.
with Ind AS 36;
The Foods CGU is tested for impairment annually,
Evaluated the design and tested the operating effectiveness of key internal controls implemented by the management
whereby the carrying amount of the CGU (including aforementioned goodwill and intangible assets) is
over the impairment assessment of Foods CGU;
compared with its recoverable amount, in accordance
Assessed the professional competence and objectivity
with the requirements of Ind AS 36, Impairment
of the management's and auditor's valuation experts;
of Assets' ('Ind AS 36'). The Company determines
Involved auditor's valuation experts to assist in evaluating
recoverable amount as higher of the:
the appropriateness of the valuation methodology and
(a) value-in-use (determined using discounted cash
the reasonableness of the assumptions used by the
flow ('DCF') model; and
(b) fair value less cost to sell (determined using
management's expert to calculate the recoverable amount of Foods CGU;
comparable companies multiple ('CCM') method)
Evaluated and challenged management's assumptions used in the impairment assessment, particularly
The annual impairment testing involves significant
those related to forecast revenue growth, earnings,
estimates and judgment by the management in
weighted average cost of capital, terminal growth rates
relation to forecasting future cash flow projections
and comparable company multiples based on our
basis expected growth rates, determining appropriate discount rate for DCF model and identification of appropriate comparable companies for the CCM
understanding of the business, past results, approved business plans and external factors;
method of valuation.
Considering the materiality of the amounts involved
Tested the mathematical accuracy of the valuation model;
and significant judgments and estimates involved in the
Assessed the robustness of the financial projections
impairment testing, this matter has been considered as
prepared by the management by comparing projections
a key audit matter for the current year audit.
of previous financial years with the actual results achieved to and carried out an analysis of significant variances, if any;
Performed an independent sensitivity analysis for reasonably possible changes in the key assumptions used in estimating the recoverable amount to assesses the estimation uncertainties involved and evaluate the sufficiency of available headroom between recoverable amount and carrying amount in the standalone financial statements; and
Evaluated the appropriateness and adequacy of the related disclosures in the standalone financial statements in accordance with applicable accounting standards.
Provision and contingent liabilities relating to taxation,
litigation and claims
(Refer Notes 2, 9, 21 and 24 to the standalone financial
statements)
• Assessed the appropriateness of the Company's accounting policies relating to provisions and contingent
The Company is involved in various direct tax, indirect
liabilities, in accordance with the applicable accounting
tax, transfer pricing arrangements, claims, general
standards;
legal proceedings ('litigations') arising in the normal course of business which includes complexities arising from uncertain tax positions.
• Obtained an understanding of the process, and evaluated the design and tested the operating effectiveness of the key internal controls around the
Provisions are recognised when the Company has a
recording and assessment of provisions and contingent
present obligation (legal/ constructive) as a result of a past event for which it is probable that a cash outflow will be required, and a reliable estimate can be made
liabilities.
• Engaged subject matter specialists, in case of material
of the amount of the obligation.
litigations, to gain an understanding of the current status of litigations and monitored changes in the disputes,
A disclosure for contingent liabilities is made where
if any, through discussions with the management
there is a possible obligation or a present obligation
and by reading external advice received by the
that may probably not require an outflow of resources.
Company from their legal counsel, where relevant,
When there is a possible or a present obligation where
to validate management's conclusions. Also, assessed
the likelihood of outflow of resources is remote, no
the professional competence and objectivity of such
provision or disclosure is made.
management experts;
The level of management judgement associated
• On a sample basis, obtained and assessed the Company's
with determining the need for, and the quantum of,
assumptions and estimates in respect of litigations,
provisions for any liabilities and disclosures of any
including the liabilities or provisions recognised or
contingent liabilities arising from these litigations is
contingent liabilities disclosed in the standalone
considered to be high.
financial statements, by reviewing the appropriateness
This judgement is dependent on a number of significant
of the probability assessment of unfavorable outcomes
assumptions and assessments which involves
of various litigations, with the help of auditor's subject
interpreting the various applicable rules, regulations,
matter specialists, wherever required;
practices and considering precedents in the various
• On a sample basis, performed substantive procedures
jurisdictions, for which the management uses various
on the underlying calculations supporting the amount
subject matter experts.
involved recorded as provisions or disclosed as
In view of the uncertainty relating to the outcome
contingent liability; and
of these litigations, the significance of the amounts
• Evaluated the appropriateness and adequacy of related
involved, and the subjectivity involved in management's
disclosures in the standalone financial statements in
judgement, this matter has been considered as a key audit matter for the current year audit.
accordance with applicable accounting standards.
Accounting for the Demerger of Ice-Cream Business
(Refer note 42 to the standalone financial statements)
During the current year, the Company has demerged
• Obtained, read and evaluated the Scheme and NCLT
its Ice Cream Business (the 'Ice-Cream Business') into
orders and verified approvals of the Board of Directors,
Kwality Wall's (India) Limited ('KWIL'), pursuant to the
shareholders, regulatory authorities and the subsequent
Scheme of Arrangement ('the Scheme') approved
filing made with Registrar of Companies;
by the National Company Law Tribunal ('NCLT'),
• Evaluated the design and tested the operating
Mumbai Bench, vide its order dated 30 October 2025
effectiveness of key internal financial controls relevant
and a rectification order dated 6 November 2025.
to accounting for the demerger and related presentation
The appointed and effective date of the Scheme is 1 December 2025.
and disclosures in the standalone financial statements;
• Assessed the appropriateness of the accounting treatment prescribed in the Scheme with the requirements of Appendix A to Ind AS 10 and the application by the Company in the books of accounts.
• Evaluated the appropriateness of the process followed by the management for the identification of assets and liabilities of the Ice-Cream Business transferred to KWIL as at the effective date;
On the effective date, the Company transferred net
• Obtained and reviewed the valuation report as prepared
assets of H876 crores pertaining to the Ice-Cream
by management's valuation expert for determination of
business to KWIL, recognised a dividend payable of
fair value of the Ice-Cream Business. Also, assessed the
H5,487 crores at fair value and recorded a gain on
professional competence, objectivity and capabilities of
disposal of the Ice-Cream business amounting to H4,611
such valuation expert;
crores, in accordance with the accounting treatment
prescribed in the Scheme which is in line with Appendix
• Involved auditor's valuation expert to assist in evaluating
A to Ind AS 10, 'Events After the Reporting Period' ('Ind
the appropriateness of valuation methodology used
AS 10'). The aforesaid gain has been presented as an
and reasonableness of significant assumptions and
exceptional item under discontinued operations.
judgments applied by the management in the fair
valuation of the Ice-Cream Business, to assess the
Further, pursuant to the Scheme, the results and cash
estimation uncertainties involved; and
flows of the Ice-Cream business until the effective
date has been disclosed as a discontinued operation in
• Evaluated the adequacy and appropriateness of
accordance with Ind AS 105, 'Non-current Assets Held
the related disclosures in the standalone financial
for Sale and Discontinued Operations'.
statements relating to the discontinued operations and
The accounting involved complexity and required
the demerger of Ice-Cream Business, in accordance
significant audit effort around the assessment of
with applicable accounting Standards.
common control, identification of assets and liabilities
to be transferred and the determination of the fair
value with respect to the Ice-Cream Business, which
involved significant judgements and estimates around
the valuation methodology and key inputs used such
as the revenue growth rate, profit margins, terminal
growth rate, discount rate, etc. which are subject to
high estimation uncertainties.
Changes to these judgments and estimates could have
a material impact on the dividend payable and the
consequential exceptional gain recognised during the
year.
Considering the materiality of the amounts involved,
complexity of the transaction, and significance of
estimates and judgements involved in fair value
determination, this matter has been considered as a
key audit matter for the current year audit.
6. The Company's Board of Directors are responsible for the other information. The other information comprises the information included in the Annual Report, but does not include the standalone financial statements and our auditor's report thereon.
Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
7. The accompanying standalone financial statements have been approved by the Company's Board of Directors. The Company's Board of Directors are responsible for the matters stated in Section 134(5) of the Act with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS specified under Section 133 of the Act and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
8. In preparing the standalone financial statements, the Board of Directors is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
9. The Board of Directors is also responsible for overseeing the Company's financial reporting process.
10. Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
11. As part of an audit in accordance with Standards on Auditing, specified under Section 143(10) of the Act we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of the Act we are also responsible for expressing our
opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls;
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;
• Conclude on the appropriateness of Board of Directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern and;
• Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
12. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
13. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
14. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
15. As required by Section 197(16) of the Act based on our audit, we report that the Company has paid remuneration to its directors during the year in accordance with the provisions of and limits laid down under Section 197 read with Schedule V to the Act.
16. As required by the Companies (Auditor's Report) Order, 2020 ('the Order') issued by the Central Government of India in terms of Section 143(11) of the Act we give in the Annexure I a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
17. Further to our comments in Annexure I, as required by Section 143(3) of the Act based on our audit, we report, to the extent applicable, that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit of the accompanying standalone financial statements;
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books, except for the possible effects of matters stated in paragraph 17(h)(vi) below on reporting in relation to audit trail as required under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 (as amended);
c) The standalone financial statements dealt with by this report are in agreement with the books of account;
d) In our opinion, the aforesaid standalone financial statements comply with Ind AS specified under Section 133 of the Act;
e) On the basis of the written representations received from the directors and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2026 from being appointed as a director in terms of Section 164(2) of the Act;
f) The modification relating to the maintenance of accounts and other matters connected therewith in relation to audit trail are as stated in paragraph 17(b) above on reporting under Section 143(3) (b) of the Act and paragraph 17(h)(vi) below on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 (as amended);
g) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company as on 31 March 2026 and the operating effectiveness of such controls, refer to our separate report in Annexure II
wherein we have expressed an unmodified opinion; and
h) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014 (as amended), in our opinion and to the best of our information and according to the explanations given to us:
i. The Company, as detailed in Notes 9, 21 and 24 to the standalone financial statements, has disclosed the impact of pending litigations on its financial position as at 31 March 2026;
ii. The provision has been made in these standalone financial statements, as required under the applicable law or Ind AS, for material foreseeable losses, on long-term contracts including derivative contracts, as detailed in Note 46 to the standalone financial statements;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended 31 March 2026;
iv. a. The management has represented
that, to the best of its knowledge and belief, as disclosed in Note 50 to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or securities premium or any other sources or kind of funds) by the Company to or in any person(s) or entity(ies), including foreign entities ('the intermediaries'), with the understanding, whether recorded in writing or otherwise, that the intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ('the Ultimate Beneficiaries') or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
b. The management has represented that, to
the best of its knowledge and belief, as disclosed in Note 50 to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities ('the Funding Parties'), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether directly or
indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ('Ultimate Beneficiaries') or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
c. Based on such audit procedures performed as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the management representations under sub-clauses (a) and (b) above contain any material misstatement.
v. The final dividend paid by the Company during the year ended 31 March 2025 in respect of such dividend declared for the previous year is in accordance with Section 123 of the Act to the extent it applies to payment of dividend.
Further, the interim dividend declared and paid by the Company during the year ended 31 March 2026 and until the date of this audit report is in compliance with Section 123 of the Act.
As stated in Note 36 to the accompanying standalone financial statements, the Board of Directors of the Company have proposed a final dividend for the year ended 31 March 2026 which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend declared is in accordance with Section 123 of the Act, to the extent it applies to declaration of dividend.
vi. Based on our examination which included test checks, except for instances mentioned below, the Company, in respect of the financial year commencing on 1 April 2025, has used accounting softwares for maintaining its books of account, which have a feature of recording audit trail (edit log) facility and the same have been operated throughout the year for all relevant transactions recorded in the respective software. Further, during the course of our
audit we did not come across any instance of the audit trail feature being tampered with for the period where audit trail is enabled and operated. Furthermore, except for the instances mentioned below, the audit trail has been preserved by the Company as per the statutory requirements for record retention where the audit trail feature was enabled:
(a) In respect of its primary accounting software used for the maintenance of all accounting records, the audit trail for changes to the application layer by a super user has been enabled and preserved w.e.f. 1 May 2024.
(b) The accounting software used for maintaining purchase orders is operated by a third-party software service provider. In the absence of an independent auditor's report in relation to controls at the third-party service provider, we are unable to comment if the audit trail feature of the said software was enabled and operated for all relevant transactions recorded in the software at the database level.
(c) In respect of the accounting software used for journal entries, the audit trail at the database level has been preserved for the preceding 180 days.
Furthermore, the daily back-up of audit trail (edit log) in respect of its primary accounting software, an accounting software for maintaining purchase orders and the accounting software for journal entries have been maintained on the servers physically located in India as mentioned in Note 51 to the standalone financial statements.
For Walker Chandiok & Co LLP
Chartered Accountants Firm's Registration No.: 001076N/N500013
Aasheesh Arjun Singh
Partner
Place: Mumbai Membership No.: 210122
Date: 30 April 2026 UDIN: 26210122CCNLPJ3504