1. At a Glance
Nestlé India just dished out a net profit of ₹659 Cr for Q1 FY26 on ₹5,096 Cr revenue. That’s a 5.9% sales growth and an 11.7% profit drop — a combo even your instant noodles would find hard to digest. But hey, it still trades at a P/E of 74. Because nostalgia sells. And Nestlé sells nostalgia.
2. Introduction with Hook
If FMCG stocks were Bollywood stars, Nestlé India is Amitabh Bachchan — old-school, marketable, evergreen, and wildly overvalued. With a 74x P/E and 23% margins, it’s like paying ₹400 for a plate of Maggi and still tipping the chef. Sales grew 4% YoY, profits dipped a bit, but the brand loyalty? Stronger than your morning Nescafé.
3. Business Model (WTF Do They Even Do?)
Nestlé India basically runs on your childhood memories and pantry staples.
Here’s the secret recipe:
- Milk & Nutrition: CERELAC for kids (and worried parents).
- Prepared Meals: The ever-bankable MAGGI.
- Confectionery: KITKAT, MILKYBAR – dentist’s recurring revenue model.
- Beverages: NESCAFÉ – powering deadlines since dial-up days.
They sell everyday things at premium prices, and the market keeps gulping it down like a cold Milo.
4. Financials Overview
| Metric | FY23 | FY24 | FY25 | TTM |
|---|---|---|---|---|
| Revenue (Cr) | 19,126 | 24,394* | 20,202 | 20,484 |
| PAT (Cr) | 2,999 | 3,933* | 3,314 | 3,227 |
| OPM (%) | 23% | 24% | 24% | 23% |
| EPS (₹) | 31.1 | 40.79 | 34.38 | 33.47 |
| ROE (%) | 153% | 169% | 83% | 83% |
*FY24 was 15 months, hence inflated.
Margins are tighter than a jar lid after leg day, but they’re consistent, and the returns are insane — Nestlé’s ROE would make even private equity blush.
5. Valuation
- P/E (TTM): 74x
- Price/Book: 54.4x
- Market Cap: ₹2.23 lakh Cr
- Fair Value Range (EduAdjusted):
- P/E 50x–60x on FY26E EPS (₹38–40): ₹1,900–2,400
This is what happens when you mix FOMO with fondness. If you think buying Nestlé at this price is “defensive,” please also buy air at ₹500/litre.
6. What’s Cooking – News, Triggers, Drama
- Q1 FY26 Sales up 5.9%, but PAT down 11.7%
- 1:1 Bonus Shares approved – a “psychological candy” to retail investors
- Manish Tiwary to become CMD from Aug 2025 – ex-Amazon, probably not launching Maggi Prime
- JV with Dr. Reddy’s – healthcare meets hot chocolate
- Nespresso Boutique opens in Delhi – now your caffeine has couture
Plot twist? Profit dipped, but excitement’s still brewing harder than their instant coffee.
7. Balance Sheet
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Equity Capital (₹Cr) | 96 | 96 | 96 |
| Reserves (₹Cr) | 2,363 | 3,244 | 4,021 |
| Borrowings (₹Cr) | 271 | 345 | 1,167 |
| Total Assets (₹Cr) | 8,979 | 10,523 | 12,324 |
Borrowings tripled in FY25 — did they buy Switzerland or just upgrade factory coffee machines? Debt’s still manageable though, given the moat (and milk powder).
8. Cash Flow – Sab Number Game Hai
| FY | CFO (₹Cr) | CFI (₹Cr) | CFF (₹Cr) | Net Flow |
|---|---|---|---|---|
| FY23 | 3,392 | -927 | -2,436 | +29 |
| FY24 | 4,175 | -1,237 | -3,135 | -198 |
| FY25 | 2,936 | -1,811 | -1,848 | -723 |
Operating cash is solid, but investing and financing are eating through it like a KitKat in summer. Good thing they’re not building luxury apartments.
9. Ratios – Sexy or Stressy?
| Ratio | Value | Comment |
|---|---|---|
| ROCE | 96% | Chef’s kiss. Nestlé runs like a Swiss watch. |
| ROE | 83% | If there were an ROE Olympics, they’d podium. |
| OPM | 23% | Despite inflation, margins stay crisp. |
| D/E | 0.28x | Just enough spice, not too salty. |
| P/E | 74x | Nestlé premium = MAGGI masala times 10 |
10. P&L Breakdown – Show Me the Money
| FY | Revenue (₹Cr) | EBITDA (₹Cr) | PAT (₹Cr) |
|---|---|---|---|
| FY23 | 19,126 | 4,471 | 2,999 |
| FY24* | 24,394 | 5,843 | 3,933 |
| FY25 | 20,202 | 4,771 | 3,314 |
*15-month year – don’t get too excited by FY24.
Even with subdued FY25, PAT > ₹3,200 Cr ain’t bad for a firm that sells milk powder and ketchup.
11. Peer Comparison
| Company | Rev (TTM ₹Cr) | PAT (₹Cr) | P/E | ROCE (%) |
|---|---|---|---|---|
| Nestlé India | 20,484 | 3,227 | 74.4 | 95.7 |
| Britannia | 17,943 | 2,195 | 62.3 | 53.0 |
| Bikaji | 2,699 | 195 | 100.0 | 18.0 |
| Zydus Wellness | 2,709 | 332 | 41.1 | 6.2 |
Nestlé isn’t cheap. It’s luxuriously overpriced. But then again, so is a ₹350 artisanal coffee, and we still buy it.
12. Miscellaneous – Shareholding, Promoters
| Shareholder Group | % Holding (Jun 2025) |
|---|---|
| Promoters | 62.76% |
| FIIs | 10.28% |
| DIIs | 11.18% |
| Public | 15.76% |
No drama here. Just steady-as-a-rock Swiss-style governance.
Retail interest peaked post bonus announcement – classic bait move.
13. EduInvesting Verdict™
Nestlé India is the Haldiram of listed companies — premium brand, sticky products, expensive stock. With 83% ROE and consistent cash flows, it’s a fortress. But the valuation? That’s where things get cheesy.
This one’s not for thrill-seekers or bargain-hunters. It’s for the “chai-biscuit portfolio” crowd that sleeps better holding Maggi than mid-caps.
Solid brand. Premium price. Buy biscuits, not dreams.
Metadata:
Written by EduInvesting Team | 25 July 2025
Tags: Nestlé India, FMCG, Nescafé, MAGGI, Q1 FY26, EduInvesting Premium
