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Systematix Report
While Nestle's current growth trajectory is at a multi-year high and on-ground trends are broadly positive, growth could decelerate in H2 FY27, highlighted the domestic brokerage firm Systematix as-
- GST-related benefits phase out from Q3, and
- growth in Maggi normalizes with a high base from Q2 27 onwards.
Input-cost inflation is monitorable, as is margin impact from high advertising and promotion, reach expansion and lower operating leverage as growth eases.
Rich valuations (trading at P/E of 70x/ 61x on FY27E/ FY28E) also limit a positive outlook. The brokerage's estimates are unchanged, with FY26-FY28E revenue/ earnings per share compound annual growth rate of 11%/ 13%.
Maintain Hold rating, valuing the stock at FY28E P/E of 65 times for target price of Rs 1,460.
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