Nestle India Ltd. shares rose as high as 2.5% on Wednesday following a positive growth outlook and review from Nuvama. According to reports from NDTV Profit, the shares jumped to a high of ₹1,397, exceeding Nuvama's price target of ₹1,383 for the FMCG major by 1%. The stock pared some gains to trade 2% higher at ₹1,389.40 apiece as of 9:35 a.m. on the NSE, compared to a 0.3% advance in the nifty index.
As reported by NDTV Profit, sales growth for the second quarter of FY27 were seen at 20% year-on-year, compared to a 10.6% base, driven by volume growth, premiumisation and e-commerce. The brokerage estimates volume growth could remain strong with 20% year-on-year rise estimated in Q1FY27. Chocolate growth could benefit from lower cocoa dependence, potentially supporting market share gains.
According to the brokerage report, e-commerce contribution is expected to be over 13%, with premium products contributing twice more than traditional channels. The premium portfolio contribution rose to 14% in FY26, compared to 11% in 2021, implying a 17% CAGR. Distribution reach expanded to 6.2 million outlets in Jun-26, as against 5.7 million in 2023.
As reported by NDTV Profit, there is significant penetration headroom across noodles, while coffee and chocolates can support long-term growth. Nuvama has maintained a buy rating on the stock with a price target of ₹1,383, factoring in Q2 sales growth, volume, low cocoa dependency, and penetration headroom for noodles among other factors.
