Nestle Q4 Preview: Analysts Expect Input Costs To Hit Margins, Profit Seen Down 8%

Nestlé India Ltd. is set to announce its financial results for the March quarter on Thursday, with brokerages expecting muted topline and bottom-line growth amid input cost pressures.

While revenue is seen rising modestly, higher raw material inflation—especially in coffee, cocoa, and edible oils—is likely to weigh on margins and profitability. Analysts believe sequential improvement is possible, but year-on-year growth may remain subdued. 

Sector-wide, brokerages say fourth-quarter trends will largely resemble the third: no significant urban recovery, gradual rural pick-up, and earnings improvement driven more by sequential base rather than annual growth. 

According to Bloomberg consensus estimates, Nestlé India's standalone revenue for the March quarter of 2025 is expected to rise 4% year-on-year to Rs 5,495 crore. Ebitda is seen falling 2% to Rs 1,325 crore, while net profit is expected to decline 8% to Rs 857 crore. Ebitda margin is likely to shrink to 24.11% from 26.46% a year earlier.

Bloomberg Estimates 

Nestlé India Q4 Preview (Standalone, YoY)

• Revenue seen 4% higher at Rs 5,495 crore versus Rs 5,268 crore.

• Ebitda seen 2% lower at Rs 1,325 crore versus Rs 1,394 crore.

• Margin seen at 24.11% versus 26.46%.

• Profit seen 8% lower at Rs 857 crore versus Rs 934 crore.

Brokerage Views

Jefferies | Target Price: Rs 2,275.25 | Rating: Hold

• Demand trends in the FMCG space remain broadly similar to the previous quarter; rural demand is gradually improving, urban demand remains subdued.

• Nestlé is likely to report flattish Ebitda growth.

• Volume growth expected at 4% year-on-year versus 5% a year ago.

• Revenue seen rising 6%, led by 4% volume growth and 2% price increases.

• Gross margin may contract 50 basis points due to inflation in coffee, cocoa and milk; Ebitda margin to shrink 42 basis points year-on-year to 25%.

• Operating Ebitda expected to rise 4%; net profit may inch up 1%.

JP Morgan | Target Price: Rs 2,250.75 | Rating: Overweight

• Revenue trends remain stable across the sector; urban demand is weak while rural recovery is slow.

• Nestlé may see steeper margin contraction versus peers due to inflation in edible oils, cocoa, tea and coffee.

• Revenue expected to rise 4% year-on-year, driven by pricing.

• Forecasts: Revenue up 4%, Ebitda down 2%, profit after tax down 8%.

Morgan Stanley | Target Price: Rs 2,250.75 | Rating: Underweight

• Urban weakness to persist; price-led growth may not fully offset input cost pressures.

• Nestlé may underperform due to soft topline growth; domestic revenue and earnings could disappoint.

• Domestic revenue growth seen at 4% versus 3% in the previous quarter.

• Ebitda margin expected to weaken year-on-year, with some sequential improvement.

• Forecasts: Revenue up 3%, Ebitda down 6%, profit after tax down 9%.

BofA Global Research | Rating: Underperform

• Demand trends remain flat with no meaningful year-on-year recovery; margins remain under pressure across staples and discretionary categories.

• Nestlé's food and beverage margins expected to stay weak.

• Forecasts: Revenue up 4%, Ebitda up 1%, recurring profit after tax down 1%.

• Value accretive investments in new categories or mergers and acquisitions could be an upside risk.

• Downside risks include rising competition and changing consumer preferences.

Goldman Sachs | Target Price: Rs 2,240.15 | Rating: Neutral

• Volume growth across the sector remains muted; pricing continues to drive revenue.

• Nestlé may report around 5% revenue growth led by higher prices in coffee, chocolates and noodles.

• Low single-digit volume growth expected.

• Ebitda margin likely to decline year-on-year due to input inflation, but sequential improvement is possible.

• Forecasts: Revenue up 4.6%, Ebitda down 4.1%, profit after tax down 2.4%.

Nomura | Target Price: Rs 2,950 | Rating: Buy

• Demand remains flat versus the previous quarter. Urban recovery depends on moderating inflation, while rural demand is improving on better crop yields.

• Nestlé expected to post modest sequential volume growth; margins likely to improve quarter-on-quarter.

• Forecasts: Volume growth at 2.5% year-on-year; revenue up 5.8%, Ebitda up 2.5%, profit after tax down 1.7%.

Nuvama | Target Price: Rs 4,050 | Rating: Buy

• Rural demand trends stronger than urban, which is expected to remain soft in the first half of financial year 2026.

• Nestlé expected to post sequential volume growth; price hikes of around 2% driven by coffee and noodles.

• Forecasts: Revenue up 5%, Ebitda up 2.6%, profit after tax down 1.9%.

Motilal Oswal | Target Price: Rs 2,322 | Rating: Buy

• Sector demand is stable but subdued; urban weakness and high palm oil prices continue to weigh on staples.

• Nestlé's urban-heavy portfolio may limit volume growth.

• Revenue seen rising 5%. Gross profit and Ebitda margins may contract 100 and 190 basis points, respectively, due to commodity inflation.