Dividend Yield Comparison — ITC vs HUL Stock

Introduction

Dividend-paying stocks play a crucial role in building long-term wealth, especially for investors seeking stable and predictable income alongside capital appreciation. In India’s FMCG space, two large-cap names consistently attract income-oriented investors—ITC Limited and Hindustan Unilever Limited. Both companies operate in defensive consumer segments, generate strong cash flows, and maintain a long history of shareholder returns, making the ITC vs HUL Stock comparison particularly relevant for long-term income strategies.

While ITC is often associated with a higher dividend yield supported by robust cash generation, Hindustan Unilever is known for dividend consistency, balance-sheet strength, and steady earnings growth. As market conditions evolve and valuations fluctuate, understanding how dividend yield, payout sustainability, and financial strength compare between these two FMCG giants becomes essential for income-focused investors.

This article presents a detailed Dividend Yield Comparison — ITC vs HUL, analysing dividend metrics, cash flow strength, profitability, balance-sheet stability, and valuation factors to determine which stock may be better suited for long-term income-seeking investors.

FMCG Dividend Landscape in India

India’s FMCG sector is considered a stable source of dividend income due to consistent demand for essential consumer products. Even during economic slowdowns, consumption remains resilient, allowing leading FMCG companies to generate predictable revenues and cash flows.

Large FMCG players typically benefit from strong brand loyalty, healthy operating margins, and low capital intensity. This enables higher free cash flow generation and supports regular dividend payouts. Efficient working capital management further strengthens their ability to reward shareholders without stressing the balance sheet.

For long-term income-focused investors, FMCG stocks offer dividend consistency and lower earnings volatility rather than aggressive yield. Against this backdrop, evaluating ITC vs HUL Stock helps investors understand how two sector leaders differ in dividend yield, payout strength, and income stability.

Company Overview: ITC and HUL

ITC Ltd

ITC Limited, established in 1910, is one of India’s leading private-sector conglomerates with a diversified presence across FMCG, hotels, paperboards and packaging, agri-business, and information technology. Its FMCG portfolio spans cigarettes, foods, personal care, education and stationery, and safety products. Over the years, ITC has built more than 25 well-recognised FMCG brands, including Aashirvaad, Sunfeast, Yippee!, Bingo!, B Natural, Savlon, Fiama, and Classmate. With a strong domestic footprint and exports to over 100 countries, ITC’s diversified business model supports steady cash generation.

Hindustan Unilever Ltd

Hindustan Unilever Limited, incorporated in 1933 as a subsidiary of Unilever, operates as a pure-play FMCG company with a focus on Home Care, Beauty & Personal Care, and Foods & Refreshment segments. The company manages a portfolio of over 50 brands across 16 FMCG categories, covering products such as soaps, detergents, personal care items, and packaged foods. HUL’s extensive distribution network, backed by manufacturing facilities across India, enables wide market penetration. While its primary market remains India, the company also serves consumers in more than 55 countries globally.

ITC vs HUL Stock Share Price Overview(As of 14 December 2025)

As of 14 December 2025, the ITC stock share price is trading in the range of Rs. 400–Rs. 404, with a 52-week high of Rs. 490.95 and a 52-week low of Rs. 391.50. The current ITC share value today reflects consolidation after previous highs, while the ITC stock rate continues to offer a relatively attractive dividend yield of 3.58%. ITC’s market capitalisation stands at Rs. 5.01 lakh crore, supported by a strong balance sheet with negligible debt and healthy return ratios. At a P/E of 24.61, the ITC limited stock price appears reasonably valued compared to its sector peers, especially from an income perspective.

In comparison, the Hindustan Unilever share price is trading between Rs. 2,245 and Rs. 2,309 as of today, with a 52-week high of Rs. 2,779.70 and a low of Rs. 2,136. The Hindustan Lever share rate reflects a premium valuation, with HUL commanding a market capitalisation of Rs. 5.31 lakh crore. Despite a lower dividend yield of 2.34%, the Hindustan Lever share value is supported by strong brand equity, zero debt, and stable profitability. With a P/E ratio of 48.67, the Hindustan Lever share price trades at a significant premium, highlighting market confidence in earnings stability and long-term growth.

Overall, while both stocks are large-cap FMCG leaders, the ITC vs HUL Stock share price comparison highlights a clear contrast—ITC offers a higher dividend yield and lower valuation, whereas the Hindustan Lever limited share price reflects consistency, balance-sheet strength, and defensive premium pricing.

Dividend Yield Comparison: ITC vs HUL Stock

ITC Ltd. Dividend Overview

ITC has maintained a consistent dividend-paying record since 2001, supported by strong operating cash flows and a diversified business structure. Over the past 12 months, the company has declared total equity dividends of Rs. 14.35 per share through interim and final payouts. At the ITC stock share price of around Rs. 400 as of 14 December 2025, the dividend yield stands at approximately 3.59%, placing ITC among the higher-yielding stocks within the FMCG sector. The company follows a flexible dividend approach, distributing interim, final, and occasional special dividends based on cash availability.

Hindustan Unilever Ltd. Dividend Overview

Hindustan Unilever has one of the longest and most consistent dividend histories among Indian large-cap companies, with regular payouts since 2001. In the last 12 months, the company has announced equity dividends totalling Rs. 43.00 per share. Based on the Hindustan Unilever share price of around Rs. 2,260 as of 14 December 2025, the dividend yield stands at approximately 1.90%. HUL’s dividend policy emphasises predictability, with a structured pattern of interim and final dividends, supported by stable earnings and strong cash generation.

Dividend Comparison: ITC vs HUL Stock

In the ITC vs HUL Stock comparison, dividend outcomes are influenced by differences in valuation, payout structure, and capital allocation rather than dividend reliability. ITC’s relatively lower valuation results in a higher dividend yield, while Hindustan Unilever’s premium valuation moderates its yield despite higher absolute dividends per share. Both companies have maintained uninterrupted dividend distributions for over two decades, highlighting their defensive FMCG positioning and long-term cash flow stability.

Dividend Consistency & Growth Track Record

Both ITC and Hindustan Unilever have maintained uninterrupted dividend payouts since 2001, supported by stable cash flows. The difference lies in the structure and consistency of dividend growth.

ITC follows a flexible payout approach, where dividend growth can vary year to year and may include special dividends based on surplus cash. Hindustan Unilever adopts a more predictable pattern, with regular interim and final dividends and gradual increases over time.

In the ITC vs HUL Stock comparison, this reflects flexibility versus predictability in dividend growth rather than differences in dividend reliability.

Operating Performance & Cash Flow Analysis — ITC vs HUL Stock

ITC and HUL both generate strong cash flows, supporting their long-term dividend strategies. ITC’s operating cash flow grew from Rs. 11,494 crore in FY21 to Rs. 16,751 crore in FY25, reflecting its large-scale operations and diversified portfolio. HUL, while smaller in absolute terms, maintained stable cash flow, spiking to Rs. 14,884 crore in FY24 due to efficient working capital management.

Free cash flow indicates the funds available for dividends. ITC’s near-neutral investing outflow in FY25 (Rs. 39 crore) ensures ample cash for payouts, whereas HUL’s higher FCF inflow (Rs. 6,763 crore) supports consistent, predictable dividends.

Profit from operations also highlights the contrast: ITC surged from Rs. 17,164 crore to Rs. 42,264 crore over five years, while HUL rose steadily from Rs. 10,490 crore to Rs. 14,300 crore, emphasizing stability over scale.

ITC vs HUL Stock — Key Cash Flow Metrics (FY25, Rs.  Cr)

Takeaway: ITC supports a higher dividend yield, while HUL ensures predictable and stable payouts. This makes the ITC vs HUL Stock comparison key for income-focused investors balancing yield versus stability.

Balance Sheet & Dividend Safety — ITC vs HUL Stock

Both ITC and HUL maintain strong, debt-free balance sheets, supporting stable dividend payouts.

• ITC has robust reserves of Rs. 66,649 crore, zero borrowings, and current assets of Rs. 39,756 crore against liabilities of Rs. 13,122 crore, providing a large liquidity buffer.
• HUL has reserves of Rs. 48,918 crore, zero borrowings, and current assets of Rs. 20,876 crore against current liabilities of Rs. 15,672 crore, ensuring predictable dividend coverage.

ITC vs HUL Stock — Key Balance Sheet Metrics (FY25, Rs.  Cr)

Takeaway: Both companies offer safe and reliable dividends, but ITC’s larger reserves and stronger liquidity provide slightly more flexibility for income investors. This comparison highlights a key factor in the ITC vs HUL Stock debate for long-term dividend-focused portfolios.

Valuation Comparison from an Income Lens — ITC vs HUL Stock

Valuation is crucial for income-focused investors, as it influences both dividend yield and potential returns. ITC trades at a relatively modest P/E of 24.61 and P/B of 7.32, offering a dividend yield of 3.58%. Its lower valuation combined with strong sales growth (10.69%) and high ROCE (37.91%) makes ITC attractive for investors seeking higher immediate income.

HUL, on the other hand, commands a premium P/E of 48.67 and P/B of 10.85, reflecting strong market confidence in its predictable earnings. Its dividend yield is lower at 2.34%, emphasizing consistency over yield. Despite slower sales growth (1.65%), HUL’s higher ROE (21.26%) and cash reserves (Rs. 7,293 crore) ensure dividend sustainability and reliability for long-term investors.

Both companies are nearly debt-free, supporting safe and predictable dividend payouts. In the ITC vs HUL Stock comparison, ITC favors yield-oriented investors, while HUL appeals to those prioritizing stability and premium growth.

Key Drivers of ITC vs HUL Stock for Income Investors

ITC and HUL both operate in stable FMCG businesses, generating steady cash flows. ITC’s diversified portfolio and strong brands support higher dividend yields, while HUL’s premium products ensure consistent margins and predictable growth. Efficient cost management strengthens profitability for both, though ITC faces regulatory risks from tobacco, whereas HUL’s risks are mainly compliance and ESG-related. Investors considering ITC vs HUL Stock should weigh yield versus stability for long-term income.

Risks to Dividend Income — ITC vs HUL Stock

Dividend income from ITC and HUL can be affected by several risks. Tax changes on dividends can reduce effective returns, while FMCG margin pressures or slower volume growth may impact payouts. Regulatory and ESG-related risks, especially for ITC’s tobacco business, can also affect cash flow. In the ITC vs HUL Stock comparison, investors should consider these factors to assess the sustainability of long-term dividend income.

Conclusion — ITC vs HUL Stock

Both ITC and HUL offer strong dividend potential supported by stable FMCG businesses, healthy cash flows, and debt-free balance sheets. ITC provides a higher dividend yield with flexible payouts, while HUL focuses on predictable, consistent dividends backed by premium brands and steady margins. Investors evaluating ITC vs HUL Stock should consider their own preference for yield versus stability when building a long-term income-focused portfolio.

Frequently Asked Questions

What is the current ITC stock share value today and Hindustan Unilever share rate?

Check the current ITC stock share value today and Hindustan Unilever share rate on the Enrich Money trading platform here

How do ITC and HUL differ in dividend growth?

ITC follows a flexible payout approach, with occasional special dividends, while HUL emphasizes gradual, consistent growth. This difference is a key consideration for income-focused investors comparing ITC vs HUL Stock.

Is dividend yield alone enough for long-term investing?

Dividend yield is important but not the only factor. Investors should also assess balance sheet strength, cash flows, profitability, and dividend sustainability. Comparing ITC limited stock price with Hindustan Lever limited share price helps understand the trade-off between income and stability.

Does share price impact dividend yield?

Yes. ITC’s lower stock price relative to its dividend makes its dividend yield higher, whereas HUL’s premium Hindustan Lever share price moderates its yield. Investors should consider ITC stock rate, HUL stock share price, and current valuations when evaluating dividends.

How often do ITC and HUL pay dividends?

Both companies follow a structured payout system with interim and final dividends each year. ITC also declares special dividends occasionally, while HUL focuses on consistent, predictable dividend growth.

Disclaimer:  This blog is dedicated exclusively for educational purposes. Please note that the securities and investments mentioned here are provided for informative purposes only and should not be construed as recommendations. Kindly ensure thorough research prior to making any investment decisions. Participation in the securities market carries inherent risks, and it's important to carefully review all associated documents before committing to investments. Please be aware that the attainment of investment objectives is not guaranteed. It's important to note that the past performance of securities and instruments does not reliably predict future performance.