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- 27 Jul 2023
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NESTLE INDIA Q2 RESULTS: NET PROFIT RISES
NESTLEIND - 2404 Change: 2.10 (0.09 %)
Nestle India reported its Q2 results on Thursday morning during market hours. Please note that Nestle follows the calendar year for result announcement, and hence we are referring to Q2 for June quarter results. The profits have jumped, but the share price closed 2.03% lower at Rs 22,338 per share. Let us look at everything in detail about Nestle India's Q2 result.
About Nestle India
Nestle India operates in the Indian market and is one of the leading food and beverage companies. Nestle India's product portfolio includes a wide range of popular brands, such as Maggi noodles, KitKat chocolates, Nescafé coffee, Milkybar, and more.
Crucial parameters
- PE: 86.28
- 52-week high: Rs 23,390
- Market Cap: Rs 2,15,252.42 crore
- ROE: 103.66
Share price movement
In the last month, Nestle India's shares have fallen 2%. In 2023, the share has rallied over 14% and given benchmark-beating returns For the 5-year time frame, the share price has more than doubled investors' wealth with 116% returns.
How has Nestle India performed in June'23 quarter?
Let us look at Nestle India's Q2 results in detail:
Profits: For Q2, Nestle India reported a net profit of Rs 698.30 crore. For the same quarter last year, the company reported a net profit of Rs 515 crore. The profits have grown at 35.6% YoY. Sequentially, net profit was down 5.1% for the company.
Revenue: The company reported a revenue of Rs 4,658.5 crore in Q2CY23. The revenue increased by 15.4% from Rs 4,036.6 crore reported in the year-ago period. Domestic sales increased by 14.6% by the FMCG giant. Sequentially, the revenue was also down - it fell 3.56%.
EBITDA: Earnings before interest, taxes, depreciation, and amortization for the quarter ended June increased by 24.7% to Rs 1,058.8 crore from Rs 849.1 crore reported in the year-ago period. EBITDA margin improved by 170 basis points to 22.7% from 21% on-year.
Management commentary: “This is the fifth quarter in a row of double-digit growth across all product groups. Domestic sales growth is broad-based and grew by 14.6%, on the back of prudent pricing and supported by mix and volume with targeted brand support," said Suresh Narayanan, Chairman and Managing Director, of Nestlé India.
How have different segments performed under Nestle?
Below is the performance of different segments:
- E-commerce: The channel contributed to 6.5% of the quarterly sales and continued the growth momentum driven by Quick Commerce.
- Organized Trade: The channel continued delivering strong broad-based growth across categories driven by store expansion and improved footfalls.
- Out of Home (OOH): Continued to deliver robust growth through premiumization and portfolio transformation initiatives. Strong performance is an outcome of kiosk expansion and prioritization of emerging channels.
- Exports: Registered robust double-digit growth across all categories through the proliferation of products such as NESCAFE Sunrise and Polo.
What is the commodity outlook that Nestle India has shared with Q2 results?
Commodities such as edible oils, wheat, and packaging materials have been in the lower price range. A reversal of the price trend is noted in fuels, with prices softening in the second quarter after reaching a higher level towards the end of quarter one. In fresh milk, there has been price stability. Robusta prices are elevated and are expected to remain volatile.