Maggi noodles maker Nestle India will showcase its earnings report for the June quarter of the fiscal year on July 24, 2025. Sales growth is expected in the mid-single digits, while net profit is likely to remain flat.
According to a Moneycontrol poll of nine brokerages, Nestle India is likely to report a 6 percent year-on-year rise in revenue at Rs 5,082 crore compared to Rs 4,793 crore reported in the same quarter last year.
Net profit for the April to June period is likely to rise by a mere 0.6 percent to Rs 751 crore as against Rs 747 reported in the corresponding quarter of the previous financial year.
Estimates of analysts polled by Moneycontrol are shown to be in a narrow range, meaning any positive or negative surprises may elicit a sharp reaction in the stock price. Among the brokerages polled, Nomura rolled out the most bullish projections while PhillipCapital forecasted the slowest growth for Nestle India.
What factors are driving the earnings?
According to experts, the decline in net profit will likely be a result of lower other income, while revenue growth is seen around six percent.
Weak demand: Brokerages noted that even though urban demand is recovering, following the slowdown, a higher dependency on urban markets might weigh on Nestle India's volumes. Most expectations see volume growth in the range of two to three percent.
Sales growth: While Moneycontrol's poll expects sales growth of six percent, the range is between five to seven percent. Growth is expected to be led by powdered liquid and beverages segment (led by pricing) and confectionery, even as milk products/nutrition could continue to lag (challenges in mid-priced baby foods segment and competition from milk co-operative players). Further, price hikes of around three percent have been taken, mainly led by coffee and premium chocolates.
Margins: According to Motilal Oswal, gross margins are likely to contract by 60 basis points to 57 percent, as a result of rising coffee and edible prices, along with other raw materials. However, the EBITDA margin is likely to be more steady.
What to look out for in the quarterly show?
Analysts will closely monitor the management’s commentaries on demand and material costs. They will also pay attention to raw material prices, particularly for coffee, milk, and sugar, and their effect on EBITDA margins, as well as the growing competitive pressure across segments. Further, updates on distribution expansion and direct reach initiatives will be closely watched out for.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
