Nestle India - March 2013 Results Preview - Motilal Oswal

- We expect Nestle India to report net sales of INR23.2b, up 13.5% YoY; we expect growth to be price-led. Volume recovery shall be gradual, in our view.

- Our recent channel checks suggest continued sluggishness in foods categories.

- We estimate flat gross and EBITDA margins at 54.3% and 22.3% respectively.

- Expect 8% growth in PAT impacted by higher capital and interest costs and 130bp increase in tax rate.

- We expect gradual pick-up in volume growth as base becomes favorable.

- The stock trades at 34.7x CY13E EPS and 28.4x CY14E EPS. Neutral.

Source : Equity Bulls

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