NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Dolat Capital Report
Nestle India Ltd.'s Q5 FY24 revenue came in-line with 8.9% YoY growth in domestic market, driven by pricing and mix led growth while exports grew 19.0% YoY. Revenue increased by 12.2% (on a four year compound annual growth rate basis).
Despite inflationary commodity prices, gross margin expanded 300 bps YoY to 56.8%. However, coffee, cocoa, cereals and grain prices saw high inflation. Milk prices are also expected to rise, due to harsh summers. The combined effect of these is expected to pressurize gross margin, in the near term.
We are introducing FY25/26E earnings per share estimates at Rs 37.9/42.7 (compared to Rs 36.8/41.7 for CY24/25E) due to change in reporting year from calendar year to financial year.
We believe Nestle's growth rate and profitability will remain high, given its strong leadership and unique positioning in most categories. We continue to value the stock at 65 times FY26E EPS and maintain ‘Accumulate' rating with revise target price at Rs 2,773 considering rich valuations. Buy on dips.
Click on the attachment to read the full report:
DISCLAIMER
This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
