Emkay Global Financial's research report on Nestle India
We see demand stress persisting in a major part of the portfolio, with demand for milk products continuing to see impact of healthy price hikes (amid inflation) and competitive pressure in prepared dishes. The Beverage and Confectionary portfolios fared well which in our view are price driven amid sharp inflation in coffee and cocoa prices. We see growth recovery being gradual, with macro recovery aiding, while easing in inflation is awaited. Q4 topline growth at 4% stood in-line, while better margin (at 25.5%, flat YoY) aided the 5% EBITDA beat, though earnings missed by 4% (fell 4% YoY) due to higher tax rate.
Outlook
We retain REDUCE on Nestlé India and Mar-26E TP of Rs 2,300, on 60x P/E.
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