More Stories

Informist, Thursday, Apr. 16, 2026

 

By Avishek Rakshit

 

KOLKATA – An improvement in urban demand leading to increased sales volume, along with price hikes across select products is expected to boost Nestle India Ltd.'s financial performance in the March quarter. However, high coffee procurement costs and a rise in palm oil costs are likely to keep its margins under pressure, according to analysts.

 

The company, which sells the Maggi brand of instant noodles and Nescafe coffee, is expected to report over a 10% on-year increase in its net profit for the March quarter to about INR 9.8 billion, according to the average of estimates from 11 brokerages. The revenue is seen rising around 14% on year to nearly INR 63 billion, the estimates showed. Sequentially, the net profit is likely to rise over 13% and the revenue is expected to increase around 11%. 

 

Kotak Securities Ltd. has the highest net profit estimate for the company at INR 10.6 billion, while Nirmal Bang Equities Pvt. Ltd. has the lowest net profit estimate at INR 8.4 billion. The latter also has the lowest revenue estimate at INR 60 billion, while Motilal Oswal Financial Services Ltd. has the highest revenue estimate at INR 64.3 billion. The Indian arm of the world's largest foods company, Nestle S.A., will declare its results for the March quarter on Tuesday. 

 

The company's top line growth for the March quarter is expected to be driven by both sales volume and price hikes, brokerages said. Brokerages Nuvama Wealth Management Ltd. and Systematix Shares and Stocks (India) Ltd. estimate a 9% on-year volume growth for the company, aided by improved consumption trends. 

 

Consumer sentiment improved during the quarter after the government cut the goods and services tax on a large portion of consumer goods in September to boost consumption. Although the move led to destocking at the distributors' end--pressuring sales volumes in the December quarter--lower prices supported consumer buying in Jan-Mar. 

 

Industry officials said sales volume improved in the March quarter despite price hikes, allowing consumer goods companies to report both volume-led and price-led growth.  Most companies raised prices in Jan-Mar to offset the rise in raw material costs and amid volatility in key input prices. 

 

Despite price hikes, consumer sentiment actually improved. Brokerage Nuvama factored in an 11-12% on-year domestic revenue growth for Nestle India in Jan-Mar. Systematix in a report said around 5% of the company's estimated revenue growth can be attributed to price hikes, with noodles, coffee, and chocolates driving the growth. However, infant nutrition may have been a laggard as far as revenue growth is concerned, it said. 

 

Despite price hikes led by higher coffee prices, demand for the Nescafe product remained stable in southern markets where coffee consumption is high. Demand for Maggi noodles also remained stable, with a slight uptick in demand in the northern and eastern states during the March quarter, retailers in Kolkata said. 

 

The company's margins in the March quarter are likely to remain under pressure as the company did not fully pass on rising input costs to consumers but absorbed some of it to sustain demand. 

 

Nuvama estimates Nestle India's gross margins to fall 57 basis points on year to 55.6%, and earnings before interest, tax, depreciation, and amortisation margins may decline 113 bps to 24.1% in the March quarter. Systematix said while raw material costs remained high, a rise in advertising expenses and distribution costs in the latest quarter could have further weighed on margins. 

 

Nestle India is expected to report an EBITDA of a little over INR 15 billion in the March quarter, according to the average of estimates from 11 brokerages. Brokerage Motilal Oswal has the highest EBITDA estimate at nearly INR 16 billion, while Nirmal Bang has the lowest at around INR 14 billion.

 

Of the 14 research reports on the company available with Informist, five have a 'buy' recommendation on the stock at an average target price of INR 1,479. Five brokerages have a 'hold' recommendation on the stock at an average target price of INR 1,379 and four recommend 'sell' at an average target price of INR 1,295.

 

At 1245 IST, shares of Nestle traded flat at INR 1,257.50 on the National Stock Exchange. The shares are down nearly 6% since the company announced its December quarter earnings in January.

 

The following are the Jan-Mar earnings estimates for Nestle India from 11 brokerages in descending order of the estimate of net profit in INR million:

 

Broker Name	Net Sales	Net Profit	EBITDA
Kotak Securities Ltd.	62,240	10,634	14,966
Motilal Oswal Financial Services Ltd.	64,334	10,347	15,978
Elara Securities (India) Pvt. Ltd.	63,900	10,100	15,000
Nomura Equity Research	62,131	10,041	15,664
JM Financial Institutional Securities Pvt. Ltd.	62,857	9,963	15,424
YES Securities (India) Ltd.	64,099	9,867	15,329
Nuvama Wealth Management Ltd.	62,194	9,603	14,995
Prabhudas Lilladher Pvt. Ltd.	63,312	9,557	14,885
Equirus Securities Pvt. Ltd.	62,765	9,435	14,750
Systematix Shares and Stocks (India) Ltd.	62,598	9,328	14,851
Nirmal Bang Equities Pvt. Ltd.	59,501	8,414	13,503
Average	62,721	9,754	15,031

 

End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Tanima Banerjee

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

 

Informist Media Tel +91 (22) 6985-4000 

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2026. All rights reserved.