While the profit after tax (PAT) is expected to grow at 2.5%-6.5% YoY in the range of Rs 713 crore to Rs 740 crore, estimates revealed it may go down in single digits on a sequential basis.
The estimates of YES Securities, Elara Capital, Deven Choksey Research and JM Financial have been taken into account.
The management’s focus is likely to stay on volume-led expansion, innovation and brand investments keeping the longer-term growth narrative intact.
The Street will keep track of management’s commentary on commodity price outlook.
The company will announce its earnings on Friday, January 30.
Here’s what brokerage estimates say about these 6 parameters:
1) PAT
— YES Securities: Expects PAT at Rs 713 crore, up 2.4% YoY, reflecting steady operating performance despite margin pressure.
— Elara Capital: Sees PAT at Rs 740 crore, up 6.5% YoY but down 1.6% QoQ, indicating seasonal moderation post the festive quarter.
— Deven Choksey Research: Estimates adjusted PAT at Rs 726 crore, up 5.5% YoY and down 2.4% QoQ.
— JM Financial: Forecasts PAT of Rs 714 crore, up 2.5% YoY and down 5.2% QoQ.
2) Revenue
— YES Securities: Revenue likely at Rs 5,257 crore, up 10% YoY, driven by healthy domestic volume growth.
— Elara Capital: Estimates revenue at Rs 5,230 crore, up 10% YoY but down 7% QoQ due to post-festive seasonality.
— Deven Choksey Research: Pegs revenue at Rs 5,288 crore, up 11% YoY and down 6% QoQ, reflecting strong underlying demand momentum.
— JM Financial: Sees revenue at Rs 5,241 crore, up 10% YoY and down 7% QoQ.
3) EBITDA
— YES Securities: EBITDA expected at Rs 1,183 crore, up 7.3% YoY.
— Elara Capital: Projects EBITDA of Rs 1,140 crore, up 8.7% YoY but down 3% QoQ.
— Deven Choksey Research: Estimates EBITDA at Rs 1,190 crore, up 8% YoY and down 4% QoQ.
— JM Financial: Sees EBITDA at Rs 1,164 crore, up 6% YoY and down 6% QoQ.
4) Margin
YES Securities: EBITDA margin likely at 22.5%, down 57 bps YoY. Gross margin is seen declining 139 bps YoY to 55% due to inflation in key inputs such as milk and arabica coffee, though robusta prices remain relatively stable.
Deven Choksey Research: Also pegs EBITDA margin at 22.5%, down 57 bps YoY but up 59 bps QoQ, indicating improving operating leverage and gradual stabilization in commodity costs.
5) Volume
YES Securities: Domestic volumes are expected to grow 6.5% YoY, underlining Nestle’s continued demand traction despite a challenging cost environment.
6) Monitorables
Deven Choksey Research notes that management continues to focus on a volume-led growth strategy, with emphasis on penetration expansion, faster innovation and sustained brand investments under the “bolder, bigger, better” framework.
The commodity outlook remains mixed — as milk prices are expected to soften post the festive season, while coffee and cocoa prices are anticipated to stabilize, offering some relief to margins going forward.
(Disclaimer: The recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)