The Nestle India Ltd. share price rallied after the March quarter numbers. However, it has drawn mixed reactions from brokerages, with Nomura and Nuvama rating the stock Buy while Motilal Oswal recommended Neutral.
The common thread across reports is a sharp jump in revenue and profit, driven by volume-led growth across categories and margin expansion despite higher advertising spends. At the same time, expensive valuations and input cost risks are factors that brokerages are watching out for.
Nomura on Nestle India: ‘Buy’
Nomura has retained a ‘Buy’ rating on Nestle India with a target price of Rs 1,500, implying an upside of 8.7% from the current market price of Rs 1,380. The brokerage said revenue rose 22.6% to Rs 6,747.8 crore in the March quarter of financial year 2026 from Rs 5,503.9 crore a year earlier, well above estimates. EBITDA climbed 28% to Rs 1,771.6 crore from Rs 1,388.3 crore, while adjusted profit increased 30% to Rs 1,150.3 crore from Rs 885.4 crore.
Nomura said the growth was led by volume and product mix, with volumes expanding more than expected and pricing contribution remaining modest. It pointed to gains from distribution expansion to around 2,16,000 villages, deeper reach across online and offline channels, and a sharp rise in advertising spends which supported demand.
“Nestle is benefiting from a confluence of external and internal factors,” Nomura said, adding that better availability, brand investments and channel expansion have supported growth across segments.
The brokerage expects revenue to increase to Rs 28,860 crore by FY28 from Rs 23,154.6 crore in FY26, with earnings growth seen at a compound annual rate of 15.5%.
It added that margins should stay supported by cost efficiencies, though firm prices of milk and edible oils along with weather-led disruptions in wheat remain risks to watch.
Nuvama on Nestle India: ‘Buy’
Nuvama has maintained a ‘Buy’ rating with a target price of Rs 1,640, implying an upside of about 18.8% from Rs 1,380. The firm said Nestle India delivered its third straight quarter of strong performance, with revenue rising 23% to Rs 6,747.8 crore in the March quarter of financial year 2026 from Rs 5,503.9 crore a year ago. EBITDA grew 28% to Rs 1,771.6 crore from Rs 1,388.3 crore, while adjusted profit rose 29.5% to Rs 1,147.1 crore from Rs 885.9 crore.
The brokerage noted that volume growth stayed in strong double digits, far ahead of expectations, and operating margin improved to 26.3% from 25.2% a year ago even as advertising spends jumped sharply.
“Revenue and EBITDA came in well above estimates, with operating leverage driving margin expansion despite a sharp increase in advertising spends,” Nuvama said.
It has raised earnings estimates for FY27 and FY28 by around 2.5% each and expects revenue to reach Rs 29,606.8 crore by FY28 from Rs 23,154.6 crore in FY26. Growth is expected to be supported by premiumisation, product innovation and expansion in quick commerce and modern trade channels.
Motilal Oswal on Nestle India: ‘Neutral’
Motilal Oswal has reiterated a ‘Neutral’ rating on Nestle India with a target price of Rs 1,400, implying a marginal upside of 1% from Rs 1,380. The brokerage said revenue increased 23% to Rs 6,750 crore in the March quarter of financial year 2026 from Rs 5,490 crore a year earlier, marking the third consecutive quarter of strong outperformance. Domestic revenue rose 23% while exports grew 31% over the same period.
It noted that EBITDA margin expanded 60 basis points to 26.3% from 25.7% a year ago, reaching an all-time high, supported by cost efficiencies despite pressure from raw material inflation.
“Given its expensive valuation, we reiterate our Neutral rating,” Motilal Oswal said, even as it acknowledged strong volume-led growth and steady performance across categories.
The brokerage expects revenue, EBITDA and adjusted profit to grow at a compound annual rate of 12%, 15% and 17%, respectively over FY26 to 2028. It added that around 85% of the company’s portfolio has benefited from goods and services tax changes, supporting demand, while investments in brands, distribution and capacity continue to drive performance.
At the same time, it pointed to persistent pressure from commodity prices, especially milk and edible oils, along with global factors such as crude-linked inflation and geopolitical tensions that could weigh on demand recovery going ahead.
Conclusion
Brokerage views on Nestle India are divided. Nomura and Nuvama see further upside backed by sustained volume growth, distribution gains and margin support, while Motilal Oswal remains cautious due to valuations. The numbers have reinforced confidence in the company’s execution, but the stock’s pricing and input cost trajectory will decide how much room is left for further gains.
Disclaimer: The investment ratings and target prices mentioned in this report are based on independent analysis by third-party brokerages and do not constitute an offer, solicitation, or recommendation to buy, sell, or hold any security. Investors are advised to consult a SEBI-registered investment advisor before making any financial decisions, as market conditions and company valuations are subject to significant volatility.
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