Hold Nestle India; target of Rs 24,650: Sharekhan

Sharekhan recommended Hold rating on Nestle India with a target price of Rs 24,650 in its research report dated July 27, 2023.

Broker Research

July 31, 2023 / 15:27 IST

hold

26 Aug, 2025 12:21

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Sharekhan's research report on Nestle India

Nestlé India Limited’s (Nestlé) revenue grew by 15.4% y-o-y to Rs. 4,658.3 crore in Q2CY2023; OPM improved by 196 bps y-o-y to 22.7% and PAT grew by 35.5% y-o-y to Rs. 698.3 crore. Volume growth in the domestic business is around mid-single-digit, which is lower than street’s expectation of a high single digit for the quarter. We expect mid-to-high single-digit volume growth momentum to sustain in the coming quarters. Softening of edible oil, packaging material, and wheat prices from the highs and stabilising of milk prices would provide some relief to margins in the coming quarters.

Outlook

The stock has run-up by ~16% in the past six months and trades at premium valuations of 71.3x, 61.6x, and 51.6x its CY2023E, CY2024E, and CY2025E EPS, respectively. In view of a limited upside, we downgrade our rating on the stock to Hold from Buy earlier with a revised PT of Rs. 24,650.

For all recommendations report, click here