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FMCG major HUL aims to deliver more than 10 per cent earnings growth in the medium to long term, its Chairman Nitin Paranjpe told shareholders on Monday.

Paranjpe, while addressing shareholders over the demerger of the company's ice-cream business, said it is in the 'best interest' of shareholders of HUL, allowing them to either continue or realise value if they wish to.

Assuring the shareholders of the company, he said HUL remains committed to delivering strong value.

However, he also acknowledged shareholders' concerns that HUL's share price has not really moved over the last few years.

Replying to them, Pranjpe said: "First, its commitment to deliver to our consumers, the reason why we exist and at the same time, deliver returns to our shareholders and therefore our aspiration in the Aspire strategy is to deliver an earnings growth of about 10 per cent plus as we move forward, not every single year but when you look at it over the medium to long term.

"That's the aspiration of the business, and we are committed to it," he said.

Paranjpe said over the last 10 years, HUL has delivered a return of 200 per cent to its shareholders, with a share price expansion of 160 per cent and the rest of it coming through dividend deals.

"Now, it is also true as some of you have picked up and commented on that our share price has not really moved over the last few years and that is true but this company has been around for the last 92 years and it wishes to be there for the next 90 odd years," he said.

Paranjpe further said HUL has been focused on the consumer and on doing the right things and is confident that "as we do the right things, shareholder value will be created and shareholders will be rewarded".

"There will be a few years when the share price expands a little lower, and there will be other years when it will expand a lot more. But over a period of time, we remain committed to delivering strong value," he said.

About the demerger of the ice-cream business, Paranjpe assured shareholders that the category in India is attractive and growing, and it is likely to continue to show growth in the times to come.

"So there is no issue as far as the ice cream category is concerned. Yes, it's a small part of the HUL's actual business (just 3 per cent). But the category is very attractive," he said.

However, he also added the ice cream business has a very distinct go-to-market operation, as it requires a dedicated cold chain, and that means there are very few synergies in our go-to-market operations with the rest of the HUL portfolio.

It is also subject to a fair amount of seasonality and is far more capital-intensive than the other categories in which it operates.

HUL is demerging its ice cream business, which owns brands such as Kwality Wall's, Cornetto and Magnum, into an independent listed entity. All existing shareholders of the FMCG major will receive shares in the new entity in proportion to their shareholding in HUL in a ratio of 1:1.

"It will give all actual shareholders an opportunity to participate in this new entity and then take an independent call whether they wish to continue to remain shareholders in this company or wish to realise the value which has been generated post the listing of this company," he added.

(This report has been published as part of the auto-generated syndicate wire feed. Apart from the headline, no editing has been done in the copy by ABP Live.)