Over the first nine months of fiscal 2014, Hindustan Unilever earned INR 30 billion, broadly in line with our full-year 2014 estimate of INR 39 billion. Revenue was up just 9% compared with our 13% estimate for the full year, however, with management citing a slowdown in market growth and competitive intensity as the main reasons. Growth in the firm's largest segment, soaps and detergents (which accounts for 49% of sales), continued to be slower at 7% than our full-year expectation of 13%, as the segment is a largely fully penetrated category across India. However, operating margins were robust at 15.3%, coming very close to our 15.2% estimate for the whole year. This was primarily led by strong growth of 9% in the firm's highest-margin personal product segment (29% of all sales); margins also remained buoyant here at 25.6% (compared with 25.7% for fiscal 2013), aided by new launches in its skin cosmetics range. Overall, margins across categories were higher than expected, as the company took on cost-cutting initiatives and judiciously invested behind innovations at the premium end of the price spectrum.
As highlighted in our last update, personal products will continue to be the key profit driver for coming years, and innovation in Hindustan Unilever's soaps and detergents segment should drive full-year growth closer to our estimates. For the moment, we continue to hold the line on our fair value estimate of INR 587 per share and believe the stock is currently fairly valued. Over the long term, the company's iconic brands will allow it to charge a premium to competitors, providing further credence to our narrow economic moat rating.