Neutral Nestlé India; target of Rs 19,875: Motilal Oswal

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26 Aug, 2025 12:21

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Motilal Oswal's research report on Nestlé India

NEST declared an in-line set of results; however, the tonnage dip in 4QCY22 (as shared in the company presentation) compared to preceding quarters indicate that the high inflation is likely to curb volume growth in the near-term. The company is planning a capex of INR50b over the next three years, which is expected to boost volume growth, especially in Prepared Dishes (Maggi) and Chocolates and Confectionary over the medium term. Valuations of 56xCY24 EPS fully capture the stock’s upside potential over the next year. We reiterate our Neutral stance on the stock.

Outlook

NEST's valuation at 56x CY24E P/E is expensive and does not offer any significant upside from a one-year perspective. We value the company at 55x Mar'25 EPS to arrive at our TP of INR19,875. We reiterate our Neutral rating on the stock.

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Nestlé India - 17 -02 - 2023 - moti