Hindustan Lever moved strong early afternoon, recovering from its low of Rs 168 on BSE.

At 12:30 IST, the stock of the FMCG behemoth rose 2.12% to Rs 173.70. Volumes of over 5.3 lakh Hindustan Lever (HLL) shares were recorded on BSE by 12:30 IST.

Hindustan Lever (HLL) has now climbed 28.6% from its 52-week low of Rs 135 on 9 May 2003. In the one year prior to that, the scrip of HLL lost 36% from its 52-week high of Rs 212 on 14 May 2002 to its 52-week low of Rs 135 on 9 May 2003.

As per market talk, brokerage Salomon Smith Barney is actively buying in HLL.

And what is surprising the market today is that this strength in the stock comes in the wake of its turning ex-dividend (the dividend outlay is Rs 7.75 per share) on Friday.

Players feel that with the monsoon expected to be satisfactory this year, investors have been accumulating the stock at every lower level. As it is, a large part of HLL's revenue (60-65%) comes from the rural segment. Players say an economic recovery and hopes of a decent monsoon this time round (which should boost rural demand) is keeping the broad market sentiment up. The Indian economy is expected to grow 6% in FY 2003-04.

On Friday last week, HLL turned ex-dividend. The company had given a special dividend of Rs 7.75 per share, which included bonus debentures of Rs 6 per share and payment of special dividend of Rs 2.76 per share to non-resident shareholders. The special dividend will be paid on or after 8 July 2003.

HLL showed a 10.65% fall in net profit to Rs 382.92 crore (Rs 428.54 crore) in the first quarter ended 31 March 2003. Net sales declined marginally by 0.55% to Rs 2,367.50 crore from Rs 2,380.66 crore in MQ 2002. But total income rose to Rs 2,508.77 crore from Rs 2,434.39 crore. Net profit turned out on the lower side of expectations, though. A capitalmarket.com poll of six FMCG analysts had forecast a 6.6% to 10.8% fall in net profit to between Rs 382 crore to Rs 400 crore. Top line was expected at between Rs 2,324.5 crore and Rs 2,488 crore.