The investment case for Unilever Nigeria Plc (NGX: UNILEVER) remains broadly positive, buoyed by improved cost optimisation (by way of proactive inventory frontloading to take advantage of favourable prices), spontaneous supplier financing, a low leverage profile, and strong revenue growth. The success of these factors is more evident than ever, with the H1'25 PAT of N14.4 billion and the cash flow from operations (CFO) of N17.4 billion, both marking their highest levels in over a decade.
In light of this performance, adjustments to our model translate to the upward revision of our 'Target Price' (TP) to N73.37 (vs. N54.99 previously). However, given the market price of the stock, our recommendation is now downgraded to a SELL, as the stock appears currently overvalued.
