Stock Price Anomalies of Products Affected by Boycotts: Geopolitics, Pandemics, and Fundamentals of Unilever Indonesia and Pakistan 2016 – 2024

Abstract

Abstract - Boycotts against multinational products associated with geopolitical conflicts, such as the pro-Palestinian boycott, have significantly affected the brand perception and the financial performance of companies across various countries, including Indonesia and Pakistan. This study analyzes the differences in stock performance and financial fundamentals between Unilever Indonesia (UNVR) and Unilever Pakistan (UPFL) during 2016–2024, during the COVID-19 pandemic and boycott campaigns. A descriptive quantitative approach was employed using secondary data, including annual financial reports, daily stock return data, and foreign exchange rates. The data were analyzed using independent sample t-tests, linear regression, and trend analysis. The results reveal that UNVR experienced a consistent decline in stock returns during the pandemic and boycott periods, accompanied by weakened financial fundamentals such as net sales, gross profit, net income, and profit margins. In contrast, UPFL exhibited stable, positive stock return trends and consistently growing financial fundamentals. The theoretical analysis suggests that institutional pressures, external signaling, ownership structure, and the management of internal resources are key factors explaining the performance divergence between the two entities. These findings underscore the importance of adaptive business strategies in responding to social and geopolitical pressures to maintain the sustainability of multinational corporations operating in developing countries.

Keywords - Unilever Indonesia, Unilever Pakistan, pro-Palestinian boycott, stock returns, financial fundamentals