Nestle India Q4 Results Review - Volume Weakness Offset By Unexpected Margin Improvement: Systematix

BQ Prime’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 BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Systematix Research Report.Nestle India Ltd. had a mixed quarter with a muted volume performance offset by an unexpected improvement in margins. Revenue growth at 13.6% fell short of expectations mainly given pressure on Maggi low unit packs volumes and some slowdown in mega cities and tier two-six markets. While volumes declined 1% YoY, mix contributed ~ 4% and pricing ~10% in our view. Growth continued to be driven by Nescafe, Milkmaid, Kitkat, Munch and mass and premium variants of Maggi. Gross margins were down 206 basis points to 54.9% given sharp inflation in milk, cereals and grains. However, Ebitda margins improved 30 bps led by savings of 80 bps in employee expenses and 150 bps in other expenses given lower marketing spends (given lower spends on new products and focus on core brands) and cost control measures (150 bps savings in CY22). Growth saw a boost from e-commerce acceleration (up 41% in CY22), recovery in out of home channel (up 39%) and opening up of exports in new categories (up 8%). Other key highlights were the consolidation of petcare business, continued distribution ramp-up in rurban markets and focus on the millets opportunity..Click on the attachment to read the full report:.More Research Reports On Nestle India's Q4 CY22 Results Review.Weak Volume; Cost Control Supports Margin: HDFC SecuritiesInline; Volumes Under Pressure: Motilal Oswal.DISCLAIMERThis report is authored by an external party. BQ Prime 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 BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Nestle India Q4 Results Review - Volume Weakness Offset By Unexpected Margin Improvement: Systematix

Growth continued to be driven by Nescafe, Milkmaid, Kitkat, Munch and mass and premium variants of Maggi.

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