Nestle India share price hits record high after strong Q3 results; Should you buy, sell or hold? | Mint
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Business News/ Markets / Stock Markets/  Nestle India share price hits record high after strong Q3 results; Should you buy, sell or hold?
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Nestle India share price hits record high after strong Q3 results; Should you buy, sell or hold?

FMCG major Nestle India reported a 37.27% rise in its net profit for the quarter ended September 2023 at ₹908 crore from ₹661.46 crore in the same quarter last year.

Nestle India’s revenue in Q3CY23 increased 9.5% to ₹5,036.8 crore from ₹4,601.8 crore in the year-ago period. (Photo: Mint)Premium
Nestle India’s revenue in Q3CY23 increased 9.5% to 5,036.8 crore from 4,601.8 crore in the year-ago period. (Photo: Mint)

Nestle India share price extended gains to hit a fresh record high on Friday after the company reported strong earnings for the quarter ended September 2023. Nestle India shares rallied as much as 1.90% to 24,580.35 apiece on the BSE.

FMCG major Nestle India reported a 37.27% rise in its net profit for the quarter ended September 2023 at 908 crore from 661.46 crore in the same quarter last year.

Nestle India’s revenue in Q3CY23 increased 9.5% to 5,036.8 crore from 4,601.8 crore in the year-ago period.

EBITDA in the July-September quarter rose 21.3% to 1,225 crore from 1,009.6 crore, YoY. EBITDA margin decreased by 220 basis points (bps) to 24.3% from 22.1%, YoY.

Read here: Nestle India Q3 Results: Net profit rises 37% YoY; board approves 140 dividend; 1:10 stock split

The company’s Board of Directors declared a second interim dividend for 2023 of 140 per equity share and also approved a share split in the ratio of 1:10.

Brokerages maintained their bullish view on Nestle India. Here’s what brokerages said:

Motilal Oswal

Nestle has a strong position in the domestic food market with an innovative product portfolio. It is focused on expanding out-of-home consumption and reaching rural markets, driving sustained double-digit earnings growth. Through substantial investments in capacity enhancement, brand support, and R&D initiatives, Nestle is well-positioned to capitalize on the vast opportunities in India's Packaged Foods segment, ensuring promising long-term revenue and earnings prospects, brokerage firm Motilal Oswal Financial Services said.

It has a ‘Neutral’ rating on the stock with a target price of 23,900 per share.

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Nuvama Institutional Equities

Nestlé’s Q3CY23 EBITDA and PAT grew 21.3% YoY and 37.3% YoY, respectively, both ahead of our and Street’s estimates, while revenue (highest-ever for any quarter) rose 9.5% YoY—below our and Street’s estimates. We reckon volume growth of ~5%. Domestic sales sustained good growth, largely driven by mix, volume and price. Gross margin and EBITDA margin expanded 381 bps and 238 bps YoY, reflecting pricing power, Nuvama Institutional Equities noted.

Nestlé India remains among the brokerage’s top picks. It has a ‘Buy’ call on the stock and raised the target price to 29,165 per share from 25,810 earlier.

At 9:35 am, Nestle India shares were trading 1.74% higher at 24,542.75 apiece on the BSE.

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Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.

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Published: 20 Oct 2023, 09:38 AM IST
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