Geojit has given Buy recommendation for Nestle India with a target price of Rs. 19,720 in its research report issued on Aug 02, 2021
Geojit’s research report on Nestle India
Nestle India Ltd., a subsidiary of Nestle S.A., is a food processing company, primarily into manufacturing of milk products and other food products such as beverages and cereals. In Q2CY21, Nestle India’s standalone revenue grew 14.0% YoY to Rs. 3,477cr driven by volume and product mix. Key products posted double-digit growth on the back of improved in-house consumption. EBITDA rose 13.4% YoY to Rs. 848cr despite margin dropping 10bps YoY to 24.4% primarily due to increase in fuel prices. PAT improved 10.7% YoY, partly impacted by higher interest and taxes. Company’s strong portfolio of brands and well-spread distribution network should improve product penetration and continue to support performance.
Hence, we reiterate our BUY rating on the stock with a revised TP of Rs. 19,720 based on 67x CY22E adj. EPS.