Nestle India Q1 Results Review - Revenue Growth A Laggard: Dolat Capital

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Dolat Capital Report.Nestle India Ltd.’s Q1 FY25 results were below our estimates. The domestic revenue grew by 4.2% YoY, while exports de-grew by 7.2% YoY. Revenue increased by 12.1% on a four-year CAGR basis.Despite inflationary pressure, gross margin expanded 280 bps YoY to 57.6%. Coffee, cocoa, cereals and grains saw high inflation, while milk, packaging and edible oils prices remained fairly stable. We believe raw material prices would pressurize gross margin, in the near term.We reduce our FY25/26E EPS estimates to Rs 36.5/41.4. Although we believe Nestle’s growth rate and profitability will remain high in the long run (given strong leadership and unique positioning in most categories), the company may also witness near-term demand and inflationary headwinds. That being said, we downgrade our rating to ‘Reduce’ from Accumulate and arrive at target price Rs 2,691 (Rs 2,773 earlier) valuing the stock at 65 times FY26E EPS. .Click on the attachment to read the full report:.Nestle India Q1 Review - Tepid Results; Commodity Cost Headwinds Emerging: Nirmal Bang.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Nestle India Q1 Results Review - Revenue Growth A Laggard: Dolat Capital

The brokerage believes raw material prices would pressurise gross margin, in the near term.

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Nestle India Q1 Results Review - Revenue Growth A Laggard: Dolat Capital

The brokerage believes raw material prices would pressurise gross margin, in the near term.

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