1:10 Split, Rs 147/Share Dividend: FMCG Major Likely To Report Profit Growth; Buy Or Sell?

Large cap FMCG giant Nestle India Ltd will hold its meeting of Board of Directors on April 25 to consider, approve financial results and and recommend final dividend for financial year 2023-24, if any. The FMCG major is likely to declare Rs 856-crore net profit on April 25 in Q1CY25, according to average estimates of leading brokerage firms. The net profit number is likely to rally 22% on-year and over 17% sequentially for the Jan-March quarter. Nestle follows a January-to-December calendar year.

According to Motilal Oswal, "We expect sales growth of 8.5% YoY and the growth momentum will continue. We expect a higher contribution from out-of-home consumption. Expect gross margin expansion of 300 bps YoY and Ebitda margin expansion of 110 bps." Motilal Oswal expected Q4 profit for Nestle India growing 15.8% at Rs 869.40 crore and sales 8.5% at Rs 5,242.50 crore.

Nestle India's revenue growth is likely to grow 8% YoY, with India business expected to witness 9% YoY growth. Meanwhile international business is likely to fall 5% YoY. Adjusted PAT is likely to grow 18% YoY, largely pushed by 16% YoY operating profit growth, according to Sharekhan said.

According to leading brokerage Axis Securities, Sharekhan, Motilal Oswal, and HDFC Securities, Nestle is likely to report its PAT in the range of Rs 840 crore to 892 crore.

Earlier, Nestle share has largely shrugged off the impact from earlier reports that reportedly mentioned the FMCG major adds sugar and honey to its infant milk and cereal products in developing nations such as India but not in European markets.

LIC Stake: It is worth noting that Life Insurance Corporation of India (LIC) has 1.84% stake in Nestle India with 1,778,769 shares of the company.

Nestle India To Consider Final Dividend: According to the regulatory filing of Nestle issued on April 11, 2024, the Board Meeting has been scheduled on 25th April 2024. The Board of Directors will consider recommendation of final dividend for the financial year 2023-24, if any, for the approval of the members at the ensuing Annual General Meeting.

Nestle India Share Performance & Return: The 52-week high price of Nestle India share on BSE is Rs 2770.75 per share (as on 02/01/2024) and 52-week low price is Rs 2048.56 per share (as on 26/04/2023). Nestle India has a market cap of Rs 2,42,133,61 crore. Nestle India shares rallied 1.89% in last 1-week, declined over 8% year-to-date, soared 21% in last 1-year, and gave return of 38% in last 2-years. In last 5-years, Nestle India shares jumped 130%.

Should You Buy Nestle India Shares? Leading International brokerage firm Citi has maintained buy call with target price of Rs 2900 per share adding the company's long-term outlook remains intact and its dominant brands will continue to lead growth.

Nestle India Dividend History: Nestle India announced 69 dividends since May 31, 2001. In last 12 months, the FMCG company announced an equity dividend amounting to Rs 147.00 per share. At the current share price of Rs 2520.65, Nestle India Ltd.'s dividend yield is 5.84%. Adjusting for Bonus/Splits the dividend yield is 0.83%.

Nestle India Stock Split History: Nestle India split the face value of its shares once since January 5, 2024. Nestle India last split face value of its shares from Rs 10 to Re 1 in 2024.The share traded ex-split from January 5, 2024, according to Trendlyne.

Nestle India Technical: Score is 49.8 indicating the stock is technically neutral. Stocks with score above 70 are considered as technically strong and below 35 are considered weak. RSI is 45.9, RSI below 30 is considered oversold and above 70 overbought. MFI is 43.4, MFI below 30 is considered oversold and above 70 overbought, according to Trendlyne.

Nestle India Q4 Results: The company announced its net profit at Rs 655.6 crore for the quarter ended December 31, 2023, up 4.4% year-on-year (YoY) as compared to Rs 628 crore in the corresponding quarter of last year.Meanwhile, revenue from operations declared at Rs 4584 crore, up 8% year-on-year (YoY) for the fourth quarter. Nestle India follows January-December financial year.The company's Earnings Before Interest Tax Depreciation and Amortisation (EBITDA) announced at Rs 1077 crore for the quarter under review, up 10.2% from the similar quarter last year. Gross margins surged 50 bps to 23.4% as against 22.9% in Q4FY23.

About Nestle India: Nestle India is a subsidiary of Nestle S.A. of Switzerland. With eight factories and a large number of co-packers, Nestle India is a vibrant Company that provides consumers in India with products of global standards and is committed to long-term sustainable growth and shareholder satisfaction, according to its official website.

Disclaimer:

The stock has been picked from the brokerage report of Citi. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.