Nestle India shares slide 5% after Q1 profit dips as cost pressures bite
Stock performance and technical outlook
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Shares of Nestle India fell as much as 5.2% to Rs 2,326 on BSE on Thursday after the Maggi-maker reported a 13.4% year-on-year (YoY) decline in its profit after tax for the first quarter of FY26, with the company citing elevated commodity prices and rising operational costs as key drags on profitability.The company's profit after tax dropped to Rs 647 crore in the June 2025 quarter from Rs 747 crore in the same quarter last year.Revenue from operations rose 6% YoY to Rs 5,096 crore in the June 2025 quarter, up from Rs 4,814 crore in the year-ago quarter. Domestic sales, which form the bulk of Nestle's revenue, climbed 5.5% to Rs 4,860 crore, compared with Rs 4,608.5 crore a year earlier. Export sales also advanced 16% to Rs 214 crore from Rs 184 crore in Q1FY25.Total income for the June quarter increased 5% YoY to Rs 5,100 crore, versus Rs 4,853 crore a year ago. The company's sale of products grew to Rs 5,074 crore from Rs 4,793 crore, while other operating revenue edged up to Rs 22 crore from Rs 21 crore.Nestle attributed the earnings decline to higher input costs across its commodity portfolio, alongside increased operational expenses linked to the expansion of its manufacturing capacity over the past seven to eight months.Borrowings from commercial banks to meet short-term operational cash flow requirements further pushed up finance costs during the quarter.Other income fell sharply to Rs 4 crore in the June 2025 quarter, from Rs 39 crore in the year-ago period.Nestle India's shares are up 7.5% so far in 2025 and have gained 6% over the past six months. However, the stock is down 4% in the last three months.On the technical charts, the stock is trading below five of its eight key simple moving averages (SMA), including the 5-day, 10-day, 20-day, 30-day, and 50-day, indicating short-term bearish momentum. It remains above the 100-day, 150-day, and 200-day SMAs, suggesting bullish undertones in the longer term.The Relative Strength Index (RSI) stands at 56.6, reflecting a neutral momentum, while the Moving Average Convergence Divergence (MACD) at 16.3 continues to trade above both the center and signal lines, pointing to an underlying bullish trend.: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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