Blog maker

Maggi-Maker Nestlé turns positive on Indian market, but Clsa expects shares to fall

mini

Shares of Nestlé India were trading in the green on Wednesday even as brokerage firm CLSA has a sell call on the company. This is days after the world’s largest food company announced its ambitions to invest Rs 5,000 crore in India by 2025.

Shares of Nestle India were trading in the green on Wednesday, September 28, even as brokerage firm CLSA issued a sales call to makers of Maggi, a staple in India’s pantry and one of India’s most beloved brands. from the country. This is days after the world’s largest food company announced its ambitions to invest Rs 5,000 crore in India by 2025.

Shares of Nestle India gained nearly one percent intraday and were trading up 0.8 percent from the previous close at Rs 18,828.50 on 11:35 BSE. In 2022 so far (year-to-date), FMCG stock has wiped out more than 17% of investors’ wealth compared to the benchmark Sensex index, which is down 3.6% at during the period.

CLSA expects the company’s shares to continue falling more than 5% from Tuesday’s close as it set the target price at Rs 17,625 per share.

The brokerage believes that given the pressures in Europe and China, the parent company of Nestlé is becoming positive for operations in India. The company is looking to expand its addressable population with an expanded portfolio, he said.

Earlier this week, Nestlé CEO Mark Schneider told Storyboard18 that the parent company wants to invest Rs 5,000 crore capex in India by 2025 for research and development (R&D) and capacity building.

The new investments will help the company accelerate its core business in the country and take advantage of new growth opportunities in established and emerging categories.

Schneider announced it during his second visit to India since joining the Swiss food and beverage major in 2017. It was also his first visit to the global market since the COVID-19 pandemic. 19 as well as the first meeting of the Board of Directors in an International Market. The meeting alludes to India’s importance and impact on Nestlé’s global program.

Today, 99% of what Nestlé sells in India is made in India. Nestlé owns over 2,000 brands worldwide and is the maker of iconic household brands such as Nescafe, Milkybar, Milo, Kit Kat, Bar-One, Milkmaid and Nestea.

Nestlé has been present in India for over a century. Schneider said that in the past 60 years since Nestle started manufacturing in India, it has invested more than Rs 8,000 crore in its operations here.