Nestle India Q4FY23 results preview: Net profit to jump 20%, sales growth continues on volume, pricing Kickstarting the earnings season for the FMCG sector, Nestle India is expected to maintain strong growth momentum with net profit jumping as high as 20.7 per cent on-year for the fourth quarter of FY2023. The FMCG major had recorded net profit of Rs 628.06 crore in the previous quarter of FY23, and Rs 594.71 crore for the fourth quarter of FY22. Nestle India is estimated to record a sales growth in double digits, in the range of 11.7- 14.5 per cent, led by a mix of volume and pricing growth. “Nestlé India is expected to maintain strong growth momentum with 12.8 per cent sales growth led by a mix of volume and pricing growth. Maggi noodles and chocolate categories are expected to grow at faster pace but milk and related product categories to see moderate sales given high milk prices are adversely impacting growth,” said ICICI Securities. Nestle India is due to announce its January-March quarter results on Tuesday, April 25. The company follows a January to December accounting year. According to brokerage firms and analysts, gross margins at Nestle India are expected to contract due to inflation in key input prices. “Gross margins to contract by 89 bps YoY, due to inflation in key input prices. EBITDA margins expected to contract by 58 bps YoY at 22.8 per cent. EBITDA expected to grow by 11.6 per cent, while PAT to grow by 13.2 per c
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If the current trend continues for a longer period of time, not only oil mills but oilseeds growers will also not be able to get good rates of their produce, says Samir Shah, president of Gujarat State Edible Oils and Oil Seeds Association (GEOA). Shah who is also past president of SOMA says that due to various international factors rates of edible oils had gone up considerably, especially imported oils earlier this year.
“With a view to curb rising prices of edible oil, the Government of India reduced import duty on edible oils. Considering the fact that India is producing hardly 30 percent of its edible oil requirement, the decision was right at that point of time. Now when international prices of edible oils have gone down by 15 percent to 25 percent and high production period has started in edible oil exporting countries, the government should gradually increase import duty to protect local oil mills and oilseeds growers,” said Shah. GEOA has also made representation before Union Minister for Commerce & Consumer Affairs, Piyush Goyal to increase import duty.
In June import duty on edible oils was ranging from 35 to 55 percent, since then the government gradually reduced import duty and at present it is ranging from zero percent to 15 percent on different edible oils, he said.
Just a month back prices of edible oils were through the roof and the government took appropriate measures by reducing import duty in order to protect consumers, says Atul Chaturvedi, president of Solvent Extractors Association of India (SEA). “Prices of edible oils are coming down globally. Kharif sowing has already started across the country. In the interest of local farmers, it is high time to enhance import duty in a phased manner to encourage local edible oil value chain,” opined Chaturvedi.
On Thursday imported Palm oil prices were at around Rs 2100 per 15 kg as against local Rs 2700 and Rs 2550 of groundnut and cottonseed oils. Prices of other local oils including ricebran, coconut, soyabean and mustard remained as high as Rs 2350, Rs 2520, Rs 2500 and Rs 2580 respectively.
India imports around 13-13.5 million tonnes of edible oils, of which around 8-8.5 million tonnes (around 63 per cent) are palm oil. Though the price of other imported Sunflower oil remained at around Rs 2700 per 15 kg, but import quantity of the oil is much lower than that of palm oil.