Result Analysis: Nestle India Ltd. (CMP: Rs.19,009)  Result Update: Q4FY22

Nestle India is one of the biggest players in FMCG segment is primarily involved in Food business which incorporates product groups viz. Milk Products and Nutrition, Prepared Dishes and Cooking Aids, Powdered and Liquid Beverages and Confectionery. The company manufactures products under brand names such as Nescafe, Maggie, Milkybar, Kit-Kat, Bar-One and Nestea. It has presence across India with 9 manufacturing facilities and four branches spread across the region.

    Open FREE* Demat & Trading Account & ₹0 AMC for first year

    Stock Details
    Market Cap. (Cr.) 183276
    Equity (Cr.) 96.42
    Face Value 10
    52 Wk. high/low 21053 / 16000
    BSE Code 500790
    Book Value (Rs) 255.06
    Sector FMCG
    Key Ratios
    Debt-equity: 0.1
    ROCE (%): 55.52
    ROE (%): 104.53
    TTM EPS: 243.25
    P/BV: 74.5
    TTM P/E: 80.66

    Result Highlights:

    • Nestle India has delivered strong results in Q4FY22 by laying a 22.8% YoY increase in the revenue from operations to Rs.4,257 cr. and huge increase of 74% in the Net profits to Rs.628 cr.

    • Company’s domestic sales rose by 22.5% YoY in the quarter led by volume and mix growth. Export Sales rose by 40.3% YoY in the December quarter.

    • Total cost of the materials rose by 17.4% YoY due to the increase in inflation. Finance cost and Net provisions reduced significantly in the quarter by ~15% and 142% respectively compared to the previous year same quarter.

    • EBITDA of the Nestle grew by 18% YoY while EBITDA margin decreased marginally by 10 bps YoY to 24% in the quarter.

    • In 2022, Nestle India has acquired PURINA Petcare business that delivers nutrition to pets and also launched globally renowned GERBER cereals catering to the nutrition needs of toddlers.

    • The management of the company declared final dividend of Rs.75 per equity share in the quarter and For the FY22 it has given dividend of Rs.220 per equity share.

    Financial Performance:

    Shareholding Pattern:

    Particulars %
    Promoters & Promoter Group 62.77
    FIIs 13.03
    DIIs 9.06
    Public 13.41
    Others 1.73

    Managerial commentary:

    Commenting on the results, Mr. Suresh Narayanan, Chairman and Managing Director, Nestlé India said, I am delighted to share that we delivered our highest double‐digit growth in a decade led by sustained volume and mix led growth, leading to a strong value growth. In 2022 total sales grew by 14.5% and domestic sales increased by 14.8%, with broad based performance across all categories. Our robust performance on e‐commerce continued, fuelled by Quick Commerce and Click & Mortar. Out‐Of‐Home (OOH) business made a strong comeback in 2022, recovering its pre‐covid base and delivering robust growth by revamping, resetting geography, channel and sales priority. We launched our first ever ‘direct to consumer’ (D2C) platform – where products manufactured by the Company in India are available in Delhi– NCR.


    Nestle India reported resilient all-round performance in Q4FY22 with led by strong double-digit growth across all categories, primarily led by price growth.Domestic as well as exports sales grew by healthy percentage compared to last year. The management stated, its Rurban strategy is fueling the overall growth despite rural market is showing a slowdown. Present inflation would take some time to settle down and would help the company in expanding the margins in the coming period. Nestle has delivered the earnings of Rs.247.9 in the FY22 and the PE of the company stands at 77x on the current price.


    Particulars (In Rs. Cr.) Q4FY22 Q3FY22 Q4FY21 QoQ% YoY% FY22 FY21
    Domestic Sales 4,062 4,372 3,568 -7.1% 22.5% 16,098 14,025
    Export Sales 171 205 146 -16.6% 40.3% 692 640
    Other Operating Revenue 24 24 33 -3.6% -26.3% 107 76
    Revenue From Operations 4,257 4,602 3,748 -7.5% 22.8% 16,897 14,741
    Other Income 30 31 27 -3.6% 12.0% 101 120
    Total Income 4,286 4,632 3,775 -7.5% 22.7% 16,998 14,861
    Cost of materials consumed 2,006 1,953 1,663 2.7% 17.4% 7,652 6,154
    Purchase of stock-in trade 95 80 68 19.0% 17.4% 348 262
    Changes in inventories -180 145 -116 -223.6% -224.8% -250 -68
    Employee expense 407 420 389 -3.1% 8.0% 1,635 1,530
    Other Expense 934 978 876 -4.6% 11.7% 3,697 3,266
    Impairment Loss on Property, Plant & Equipment 13 29 1
    EBITDA 981 1,026 868 -4.3% 18.1% 3,785 3,595
    EBITDA Margin (%) 24.2% 23.5% 24.3% 70 bps -10 bps 23.5% 25.6%
    Finance Cost 45 37 44 20.5% -14.7% 155 202
    Depreciation & Amortisation expense 99 98 106 0.5% -7.4% 403 391
    Net Provisions for Contingencies -9.53 6 -14 -259.6% -142.0% 16 -25
    Corporate Social Responsibility Expense 18 16 24 13.5% -34.7% 56 53
    Exceptional Items 237 237
    Profit Before Tax 859 899 500 -4.5% 79.9% 3,256 2,857
    Tax 231 238 121 -2.9% 97.4% 865 739
    Profit After Tax 628 661 379 -5.0% 74.3% 2391 2118
    PAT Margin (%) 14.8% 14.4% 10.1% 40 bps 470 bps 14.1% 14.4%
    EPS (in Rs.) 65.14 68.61 39.36 -5.1% 74.3% 247.94 219.72
    Source: Company website, EWL Research

    Disclosure in pursuance of Section 19 of SEBI (RA) Regulation 2014

    Elite Wealth Limited does/does not do business with companies covered in its research reports. Investors should be aware that the Elite Wealth Limited may/may not have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only information in making their investment decision and must exercise their own judgment before making any investment decision.
    For analyst certification and other important disclosures, see the Disclosure Appendix, or go to Analysts employed by Elite Wealth Limited are registered/qualified as research analysts with SEBI in India.( SEBI Registration No.: INH100002300)
    Disclosure Appendix
    Analyst Certification (For Reports)
    Israil Khan, Elite Wealth Limited,
    The analyst(s) certify that all of the views expressed in this report accurately reflect my/our personal views about the subject company or companies and its or their securities. I/We also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report. Unless otherwise stated, the individuals listed on the cover page of this report are analysts in Elite Wealth Limited.
    As to each individual report referenced herein, the primary research analyst(s) named within the report individually certify, with respect to each security or issuer that the analyst covered in the report, that:
    (1) all of the views expressed in the report accurately reflect his or her personal views about any and all of the subject securities or issuers; and
    (2) no part of any of the research analyst’s compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed in the report.
    For individual analyst certifications, please refer to the disclosure section at the end of the attached individual notes.
    Research Excerpts
    This note may include excerpts from previously published research. For access to the full reports, including analyst certification and important disclosures, investment thesis, valuation methodology, and risks to rating and price targets, please visit
    Company-Specific Disclosures
    Important disclosures, including price charts, are available and all Elite Wealth Limited covered companies by visiting, or emailing with your request. Elite Wealth Limited may screen companies based on Strategy, Technical, and Quantitative Research. For important disclosures for these companies, please e-mail
    Options related research:
    If the information contained herein regards options related research, such information is available only to persons who have received the proper option risk disclosure documents. For a copy of the risk disclosure documents, please contact your Broker’s Representative or visit the OCC’s website at
    Other Disclosures
    All research reports made available to clients are simultaneously available on our client websites. Not all research content is redistributed, e-mailed or made available to third-party aggregators. For all research reports available on a particular stock, please contact your respective broker’s sales person.
    Ownership and material conflicts of interest Disclosure
    Elite Wealth Limited policy prohibits its analysts, professionals reporting to analysts from owning securities of any company in the analyst’s area of coverage. Analyst compensation: Analysts are salary based permanent employees of Elite Wealth Limited. Analyst as officer or director: Elite Wealth Limited policy prohibits its analysts, persons reporting to analysts from serving as an officer, director, board member or employee of any company in the analyst’s area of coverage.
    Country Specific Disclosures
    India – For private circulation only, not for sale.
    Legal Entities Disclosures
    Mr. Ravinder Parkash Seth is the Managing Director of Elite Wealth Ltd (EWL, henceforth), having its registered office at Casa Picasso, Golf Course Extension, Near Rajesh Pilot Chowk, Radha Swami, Sector-61, Gurgaon-122001 Haryana, is a SEBI registered Research Analyst and is regulated by Securities and Exchange Board of India. Telephone:011-43035555, Facsimile: 011-22795783 and Website:
    EWL discloses all material information about itself including its business activity, disciplinary history, the terms and conditions on which it offers research report, details of associates and such other information as is necessary to take an investment decision, including the following:
    1. Reports
    a) EWL or his associate or his relative has no financial interest in the subject company and the nature of such financial interest;
    (b) EWL or its associates or relatives, have no actual/beneficial ownership of one per cent. or more in the securities of the subject company, at the end of the month immediately preceding the date of publication of the research report or date of the public appearance;
    (c) EWL or its associate or his relative, has no other material conflict of interest at the time of publication of the research report or at the time of public appearance;
    2. Compensation
    (a) EWL or its associates have not received any compensation from the subject company in the past twelve months;
    (b) EWL or its associates have not managed or co-managed public offering of securities for the subject company in the past twelve months;
    (c) EWL or its associates have not received any compensation for investment banking or merchant banking or brokerage services from the subject company in the past twelve months;
    (d) EWL or its associates have not received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past twelve months;
    (e) EWL or its associates have not received any compensation or other benefits from the Subject Company or third party in connection with the research report.
    3 In respect of Public Appearances
    (a) EWL or its associates have not received any compensation from the subject company in the past twelve months;
    (b) The subject company is not now or never a client during twelve months preceding the date of distribution of the research report and the types of services provided by EWL