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INVESTMENT INSIGHTS

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 quality company, based on a 10 year financial track record.
Q.3 Is Nestle India Ltd undervalued or overvalued?
Nestle India Ltd appears Fair, as its key valuation ratios are in line with their past averages.
Q.4 Is Nestle India Ltd a good buy now?
Nestle India Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. 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 10.3% , indicating slower growth.
Q.2 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 below its 5 year median of 23% , indicating decreasing margins.
Q.3 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 below its 5 year median of 23.96% indicating decreasing margins.
Q.4 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 Historic Median
Gross Profit Margin 22.4 23
Operating Profit Margin 23.69 23.96
Net Profit Margin 16.41 15.6
Q.5 Return on Asset of Nestle India Ltd?
Nestle India Ltd Return on Asset is 29.01(x), which is above its 5 year historical median of 27.86(x), indicating improved asset utilization efficiency.
Q.6 Return on Equity (ROE) of Nestle India Ltd?
Nestle India Ltd Return on equity is 88.88% for FY-2025 , which is below its historical median of 106.84%, indicating the business is making worse use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of Nestle India Ltd?
Nestle India Ltd Return on capital employed is 111.22% for FY-2025 , which is above its estimated weighted average cost of capital(WACC) 11.25%, indicating value creation.
Q.8 Cash conversion cycle of Nestle India Ltd?
Nestle India Ltd Cash conversion cycle is -10 , above its historical median of -14 , indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level Historic Median
Asset Turnover 1.84 1.89
ROE 88.88 106.84
ROCE 111.22 151.64
Cash Conversion Cycle -10 -14
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, indicating the business is able to service its debt comfortably.

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 Industry Median
Revenue 20,201.6 16,300.6
Gross Profit 4,525.3 3,288.8
Operating Profit 4,771 3,633
Net Profit 3,315 2,134
Operating Efficiency
Current Level Industry Median
Asset Turnover 1.84 1.89
ROE 88.88 52.5
ROCE 111.22 49.25
Cash Conversion Cycle -10.36 -10

Valuation & price assessment

Q.1 Stock return of Nestle India Ltd over the last decade?
Over the last 9 years, the stock has delivered a CAGR of 14.9% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price 14.9% 7.4% 8% 3.9%
Q.3 Valuation ratios of Nestle India Ltd vs historical?
The current P/E is lower that its historical median.
Q.4 How do the current valuation ratios measure up against the historic numbers and the current industry numbers?
Valuation Ratios Current Historic Median Industry Median
Price to Earnings 72.63 74.85 51.80
Price to Book 43.15 68.32 2.42
Price to Sales 11.05 12.28 1.42
EV to EBITDA 49.3 48.51 14.55

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