Nestle India Ltd. share price target

Prices have respected the channel's upper and lower band.

We maintain HOLD with revised TP of Rs 18,300 (60x Mar-24E) vs earlier TP of Rs 18,600 (60x CY23E).

Price hikes insufficient to offset commodity inflation | 13000 crore of sales. It is broadly present in infant & baby food products, noodles, chocolates & beverage categories. In the last five years, the company has forayed...

reduction LUP's in chocolates, Maggi and Milk products. Medium to long term growth drivers remain intact led by 1) sustained expansion in rural reach (only 20% of sales) 2) availability of capacity in Maggi 3) huge scope of growth in segments like coffee, RTD and Chocolates and 4) higher growth in channels of future like E-commerce (up 71% YoY in 1Q, 6.3% of domestic revenues). While we expect further pickup in growth in OOH segments, 4 th covid wave might be a risk in the near term. We expect near term margin pressure to sustain given inflation in Coffee,...

Overall volume growth of ~11% in CY21 was healthy, with strong growth in Beverages (up ~18% YoY) and Prepared Dishes and Cooking Aids (Maggi, up ~16% YoY). Since Prepared Dishes constitute ~60% of total volumes v/s ~31% of sales, overall volume growth is very healthy in years when this segment performs very well. Volumes in Milk and Nutrition (M&N, 43%/25% of total sales/volumes) fell 2.7% YoY in CY21, clocking another disappointing year for NEST's largest segment by sales. This continues the trend of flattish volumes in this segment in three out of the past four years. While volume growth has been robust across the other three categories since...

Revenue grew 10.2% to Rs. 14,709cr in CY21, due to domestic sales which accounted for 95% of total revenue. Domestic sales growth is largely driven by increased volume and mix. Also, strong growth...