Nestle India Ltd. share price target

We recommend a BUY rating on the stock with a near-term TP of Rs 21,700, implying an upside of 10% from the CMP

Highest domestic revenue growth in a decade, at 14.8% in CY22, led by both volumes and pricing

Nestle India (NEST) continues to report mid to high teens (14-18%) revenue growth driven by broad based performance across all segments. Impact of price hike on LUPs (15-20% salience) is moderately concerning. However, early-signs of clawing back volume market share in the main-stream and premium segments is comforting.

We estimate Revenue/EBITDA/PAT CAGR of 11%/14%/15% over CY22-25E based on the above thesis and we maintain our BUY rating on the stock with the unchanged TP of Rs 22,000/share. We value the company at 65x CY24 EPS. The TP implies an upside of 12% from the CMP.

CY22 revenue increased 14.5% YoY with broad-based growth across categories

The recently held investor meet of Nestle S.A has given us glimpses of India becoming an (even more) important geography for the parent.