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Nestle India drops after Q1 results

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Capital Market
Last Updated : May 13 2013 | 5:00 PM IST

The company announced Q1 results during trading hours today, 13 May 2013.

Meanwhile, the S&P BSE Sensex was down 424.88 points or 2.11% at 19,697.44.

On BSE, 3,406 shares were traded in the counter as against average daily volume of 2,945 shares in the past one quarter.

The stock hit a high of Rs 4,944.60 and a low of Rs 4,775 so far during the day. The stock had hit a 52-week low of Rs 4,305.55 on 27 September 2012. The stock had hit a record high of Rs 5,050 on 30 April 2013.

The stock had outperformed the market over the past one month till 11 May 2013, surging 8.7% compared with the Sensex's 8.52% rally. The scrip had also outperformed the market in past one quarter, jumping 6.35% as against Sensex's 3.4% gain.

The large-cap company has equity capital of Rs 96.42 crore. Face value per share is Rs 10.

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Nestle India said that the net profit for Q1 March 2013 is not comparable with that of the net profit in Q1 March 2012 as the net profit in Q1 March 2013 has been negatively impacted due to changes in regulatory procedures. These changes resulted in timing differences for certain provisions for contingencies that reduced the net profit in Q1 March 2013, Nestle India said in a statement.

Nestle India's net domestic sales rose 7.7% in Q1 March 2013, mainly on account of net realisations and product mix, the company said. Exports jumped 50.9% in Q1 March 2013.

Nestle India said that the cost of materials for goods sold as a percentage of net sales declined in Q1 March 2013 due to higher sales realizations, partially offset by higher input costs. Finance costs increased mainly due to higher average outstanding loan during Q1 March 2013 as well as due to completion of major capital projects for expansion of capacity, resulting in finance costs being charged to the income statement in Q1 March 2013, as against being treated as capital expenditure in Q1 March 2012, the company said in a statement.

During the quarter, there was no additional drawdown of loan from Nestle SA under the ECB approval from the RBI, Nestle India said. As on 31 March 2013, the total amount outstanding on this account $192 million (Rs 1043.33 crore), the company said. The annualised cost of ECB over the loan period up to 31 March 2013, including interest and exchange difference, is 13.9%, Nestle India said.

Commenting on the company's Q1 results, Mr. A Helio Waszyk, Chairman and MD, Nestle India said, "The start of the year reflects the caution that we have been expressing. While facing several challenges, our concerned efforts are starting to show positive signals in certain categories while in others it may take some more time. We expect some volatility to continue throughout 2013 but remain confident on our strategy to deliver long term sustainable profitable growth, which has been progressing well"

Nestle India is a subsidiary of Nestle S.A. of Switzerland. With seven factories and a large number of co-packers, Nestle India manufactures milk products and other food products.

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First Published: May 13 2013 | 3:06 PM IST

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