Nestle India Q3 Results Review

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Nestle India Ltd.’s Q3 CY22 results were in line with our estimate. The company reported 18.3% YoY growth in the domestic market driven by volume and mix while exports business posted 15.7% YoY increase.

On a three-year compound annual growth rate basis, revenues increased by 13% – indicates acceleration in overall growth.

E-com channel posted strong growth fueled by new formats – ‘quick commerce’ and ‘click and mortar’ helped increase the sales contribution to 7.2%.

Nestle India’s gross margin decline by 290 basis points YoY mainly attributed to higher inflation related to edible oils, milk and its derivatives, packaging materials, partly offset by better realisations.

While edible oil and packaging costs witness softening by the end of the quarter, fresh milk, fuels, grains and green coffee costs are expected to remain firm.

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