Motilal Oswal's research report on Nestle India
Nestle India (Nestle) has seen a strong recovery in FY26, with revenue growth of 15% YoY, supported by a rebound in volume growth (+11% in FY26 vs. broadly flat volumes in FY25). Volume acceleration was led by strong double-digit growth across Prepared Dishes, Beverages and Confectionery. Milk Products & Nutrition reported a modest 2% volume decline in FY26 (vs. mid-single-digit decline in FY25). Distribution expansion, innovation, improving accessibility and market share gains have boosted growth. Distribution network increased to 5.3m retail outlets (from 5.2m in FY25), extending the company’s presence to 0.22m villages (vs. 0.21m villages in FY25). Ecommerce contributes 12% of revenue in FY26.
Outlook
In F&B, Nestlé maintained its best-in-class execution. We model a CAGR of 12%, 15% and 18% in revenue, EBITDA and APAT, respectively, during FY26-28E. The stock is trading at 68x/60x FY27E/FY28E EPS. Given its expensive valuation, we reiterate our Neutral rating with a TP of INR1,400 (based on 60x P/E Mar'28E).
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Nestle India - 3006026 - moti