ICICI Direct is bullish on Nestlé India has recommended buy rating on the stock with a target price of Rs 12000 in its research report dated May 15, 2019.
ICICI Direct's research report on Nestlé India
Net sales for the quarter increased 8.9% YoY to Rs 3,003 crore led by robust domestic volume growth driven by aggressive new launches last year. Operating profit increased 5.9% to Rs 737.7 crore while margins declined 71 bps to 24.6% on a high base. Net profit increased 9.3% to Rs 463.3 crore on account of higher other income (Rs 73 crore vs. Rs 56 crore in the base quarter). Nestlé India (NIL) has announced an interim dividend of Rs 23/share.
NIL plans to accelerate innovations centred on superior health, nutrition and wellness at appropriate price points. We expect earnings growth at 19.7% CAGR in CY18-20E led by strong sales growth CAGR of 12.9% in the same period. We reiterate BUY recommendation with a target price of Rs 12000/share.
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