Check Before You Invest : Nestle India Ltd

BSE: 500790 NSE: NESTLEIND ISIN: INE239A01024

| Sector: FMCG | Industry: Consumer Food

Snapshot

Q.1 Which industry/sub-sector does Nestle India Ltd belong to?

Nestle India Ltd belongs to the FMCG sector, operating specifically within the Consumer Food segment.

Q.2 Is Nestle India Ltd a good quality company?

Nestle India Ltd is a good quality company, based on a consistently good 10-year financial track record.

Q.3 Is Nestle India Ltd undervalued or overvalued?

Nestle India Ltd appears Somewhat overvalued, as its key valuation ratios are above with their past averages.

Q.4 Is Nestle India Ltd a good buy now?

Nestle India Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of Nestle India Ltd?

Nestle India Ltd revenue growth is 3.5% for FY-2025, which is below its 5-year CAGR of 10.31%, indicating slower growth.

Q.2 Return on capital employed (ROCE) of Nestle India Ltd?

Nestle India Ltd Return on capital employed is 111.22% for FY-2025, which is below its 5-year historical median of 151.64%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Q.3 Return on Asset of Nestle India Ltd?

Nestle India Ltd Return on Asset is 29.01%, which is in line with its 5-year historical median of 27.86%, indicating stable asset utilization efficiency.

Q.4 Return on Equity (ROE) of Nestle India Ltd?

Nestle India Ltd Return on equity is 88.88% for FY-2025, which is below its 5-year historical median of 106.84%, indicating the business is making worse use of its shareholders capital.

Q.5 Cash conversion cycle of Nestle India Ltd?

Nestle India Ltd Cash conversion cycle is -10 days, above its 5-year historical median of -14 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover	1.84	1.89
ROE	88.88	106.84
ROCE	111.22	151.64
Cash Conversion Cycle	-10 days	-14 days

Q.6 Gross Profit margin of Nestle India Ltd?

Nestle India Ltd Gross profit margin which is the profit after deduction of direct costs, is 22.4% for FY-2025, which is in line with its 5-year median of 23%, indicating stable margins.

Q.7 Operating Profit Margin of Nestle India Ltd?

Nestle India Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 23.69% for FY-2025, which is in line with its 5-year median of 23.96% indicating stable margins.

Q.8 Net Profit Margin of Nestle India Ltd?

Nestle India Ltd Net Profit Margin is 16.41% for FY-2025, is above with its 5-year median of 15.6%, indicating increasing margins.

	Current Level	5-year Historic Median
Gross Profit Margin	22.4	23
Operating Profit Margin	23.69	23.96
Net Profit Margin	16.41	15.6

Q.9 Debt to Equity ratio of Nestle India Ltd?

Nestle India Ltd Debt-to-Equity ratio is 0.18, which is lower with the industry average of 0.6, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Nestle India Ltd?

Nestle India Ltd Debt to cash flow from operations is 0.26, which is at a healthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Nestle India Ltd?

Promoters hold 62.76% of the Nestle India Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Nestle India Ltd vs industry peers?

Nestle India Ltd revenue CAGR is 10.31%, compared to the industry median CAGR of 10.31%, indicating slower growth and losing its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth	3.5	10.3
Gross Profit Growth	-19.7	9.9
Operating Profit Growth	-18.4	11.6
Net Profit Growth	-15.7	11

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover	1.84	1.89
ROE	88.88	52.5
ROCE	111.22	49.25
Cash Conversion Cycle (days)	-10.36	-10

Valuation & price assessment

Q.1 Stock return of Nestle India Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 18% based on the current price.

Q.2 What return has the stock given over the last decade?

	9Y	5Y	3Y	1Y
Share Price CAGR	18%	12%	10.3%	24.8%

Q.3 Valuation ratios of Nestle India Ltd vs historical?

The current P/E is similar that its historical median.

Q.4 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	79.31	79.01	26.64
Price to Book	52.95	64.19	2.52
Price to Sales	12.18	11.91	1.43
EV to EBITDA	52.33	49.73	14.44

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