Nestle falls 2% post Q3 earnings. Here’s how brokerages view this stock

Nestle India shares fell over 2% to the day’s low of Rs 2,447 on the NSE in Monday’s trade amid selling pressure in most FMCG stocks with the Nifty FMCG index as the worst-performing index. However, brokerages Citi and Nuvama remain optimistic about the stock’s prospects, each recommending a ‘Buy’. Meanwhile, Motilal Oswal held a neutral rating calling valuations on the higher side.

Also Read: Nestle India Q4 Results: Profit rises 4% YoY to Rs 656 crore; revenue up 8%

Here’s what brokerages recommended:

Citi: Buy | Target: Rs 2,900

Citi maintained a ‘Buy’ view with a target price of Rs 2,900. The company reported steady revenues and margin expansion in Q4CY23, it said while highlighting the need to monitor potential payment to parent for support services. It is of the view that the price increases in parts of the portfolio and soft commodity prices will continue to drive profitability/earnings growth in the the near-term.

Nuvama: Buy | Target: Rs 3,010

Nuvama reiterated a buy view on the counter while raising the target price at Rs 3,010 from an earlier target of Rs 2,915.
Nestlé’s Q4CY23 revenue and EBITDA grew 8.1% and 12.5% YoY, respectively in line with brokerage’s estimates. “Nestlé’s RURBAN approach continues to play out well with the focus on strengthening distribution infrastructure, raising feet on street, etc. We roll forward to Q4CY25E, yielding a revised target price of Rs 3,010,” Nuvama said, calling Nestle its one of the top picks and retaining a ‘Buy’.

Motilal Oswal: Neutral | Target: Rs 2,400

Motilal Oswal reiterated a neutral stance on Nestle India shares calling valuations “expensive” while holding its Q3FY24 earnings as steady performance. “Nestle has been building its blocks around its RURBAN strategy and driving its distribution reach in the untapped markets. There has been a broad-based growth across brands for the last few years,” Motilal said.The target recommendation is at Rs 2,400 which is based on 60X P/E December 2025E.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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