The stock price of Nestlé India went down by 3% in the early trade of 18 February 2022, after the FMCG giant released its 4th quarter earnings for the fiscal year of 2022. It reported a 19.99% year-on-year reduction in revenue in the net profit of this October to December quarter. For this quarter, Nestlé India reported Rs. 386.66 crores in net profit, which was Rs. 483.31 in the previous financial year. On the other hand, the revenue from operations of this FMCG Company was Rs. 3,739.32 crores, which is an 8.93% jump over the previous year’s Rs. 3,432.58 crores.
The stock price slipped from Rs. 18,084 from the previous day to Rs. 17,582, which is a reduction of 2.78%. The stocks of Nestlé India were trading at a low of 5, 20, 50, 100, and 200 days moving average. Moreover, the stock of this company gained by 10.13% in the previous year, but it has gone down by 8.5% since the beginning of 2022. The market cap of Nestlé India was at Rs. 1.73 lakh crores on BSE on this day.
In terms of dividend share, Nestlé India’s board has decided on a Rs. 65 per share dividend for 2021.
What Are the Brokerages Saying About This Situation?
One of India’s leading brokerage firms, YES Securities, has maintained a positive stance on this stock. The reason is a strong Q3 performance.
In its official statement related to this matter, the firm stated that this quarter is a testament to Nestlé’s potential. It also shows this FMCG firm’s margin resilience as it delivered 8% volume growth in spite of the inflation and rural headwinds. Moreover, the growth has remained resilient owing to 20% to 25% salience in India’s rural markets and the distribution in rural as well as semi-urban markets. This is driving the category penetration.
Moreover, this brokerage firm is expecting 12% to 14% revenue or PAT CAGR during CY 2022-2023.
India’s prominent financial brokerage service, Motilal Oswal, maintains a neutral stance on this stock.
The fourth-quarter sales of Nestlé India are in line with their estimation. The volume growth of the 2021 calendar year has been impressive at 9.6%. However, its segmental performance has remained mixed.
This brokerage firm maintains a long-term investment case for Nestlé India, primarily driven by its high topline growth. However, its commodity cost and expensive valuations lead to this neutral stance.
As of writing on 23 February 2022, Nestlé India is trading at Rs. 18,008.10 on the National Stock Exchange, which is a rise against the drop on 18 February 2022. Nonetheless, if you are planning to invest in this stock, you should conduct thorough researchof the company details and finances before taking any decision.
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Frequently Asked Questions
What is the face value of Nestlé India’s share?
The face value of Nestlé India’s shares is Rs. 10 per equity share.
What is the current sector PE of Nestlé India?
The current sector PE of Nestlé India is 66.52.
What is the current dividend yield of Nestlé India?
The current dividend yield of Nestlé India is 0.75.
Disclaimer: This blog is exclusively for educational purposes and does not provide any advice/tips on investment or recommend buying and selling any stock.