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Why Unilever’s Stock Keeps Falling: A Deeper Look at Growth and Book Value

If you bought Unilever Indonesia (UNVR) shares five years ago, you’d be sitting on a 22% loss. But if you bought them 11 years ago, you’d still be up nearly 198%. On the surface, that looks decent—yet compared to other consumer goods giants like Mayora or Ultrajaya, Unilever’s growth has been sluggish. This article breaks down why.

Comparing Growth in Consumer Goods Stocks

Let’s imagine investing IDR 10 million in 2010:

• Mayora: Grew into IDR 190 million (+1800%).
• Ultrajaya: Became IDR 102 million (+923%).
• Japfa: Reached IDR 75 million (+650%).
• Indofood CBP: IDR 34.6 million (+246%).
• Unilever: Only IDR 29.8 million (+198%).

While Unilever still grew, it lagged far behind its peers. Why? Two simple indicators help explain it: sales growth and book value growth.

Indicator 1: Sales Growth

A good business consistently increases sales. Think of a bakso (meatball) stall selling 1000 bowls in year one. If it grows 10% yearly, by year 10 it’s selling nearly 2600 bowls. That’s clear evidence of strength. Among consumer goods companies, Mayora showed a 225% increase in sales over 10 years, while Unilever’s sales only rose 118%.

Indicator 2: Book Value Growth

Book value represents the company’s net worth per share. If profits are reinvested, book value rises. Back to the bakso stall: if it starts with IDR 10 million in equity and reinvests profits, its book value per share rises significantly over time. A company whose book value keeps climbing is usually healthier long term.

From 2010–2020:

• Mayora: Book value up 427% (from IDR 1M to IDR 5.2M per share).
• Japfa: Book value up 250% (to IDR 3.5M per share).
• Unilever: Only 21.9% growth (to IDR 1.2M per share).

Clearly, Unilever has struggled to reinvest and expand equity compared to rivals.

What the Market Rewards

Investors pay higher premiums for companies that show strong, sustained growth in both sales and book value. That’s why Mayora’s stock soared 1800% in 11 years, while Unilever lagged with just 198%.

Important Caveats

• Sales and book value are powerful, but not absolute indicators. Other metrics like ROE, P/E ratio, debt levels, and cash flow also matter.
• Even with weak relative growth, Unilever still outperformed deposits and fixed income over 11 years.
• A “bad” stock in one sector may still beat safer instruments.

Takeaways for Investors

1. Compare companies within the same sector using simple growth metrics.
2. Look for consistent sales and book value growth as signs of quality.
3. Be cautious—growth alone doesn’t guarantee future returns.

Final Thoughts

Unilever’s underperformance isn’t about being a bad company—it’s about being slower than its peers. In consumer goods, growth leaders like Mayora and Ultrajaya outshine. But as long-term investors, the lesson is clear: always dig beyond brand strength and focus on fundamentals like sales and equity growth.

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Labels: Finance

References / Sources

• “Kenapa Saham Unilever Turun Terus? (Part 2)” — Channel: Saham dari Nol — Original video