Nestle India Tumbles Despite 36% Profit Surge

’s Q2 FY27 results are out, and the stock has fallen sharply since. It closed at ₹1,383.20 on October 14. On October 15, the day of the results, it fell 7.76% to ₹1,275.80, after an intraday low of ₹1,260.50 (down about 8.9%). On October 16 it fell another 0.81% (₹10.30) to ₹1,265.50, in a day range of roughly ₹1,250-1,290. That is a fall of about 8.5% over two sessions. For the week it fell 5.06% and lost about ₹13,016 crore in market value, the worst performer on the Nifty. The results were strong. Net profit rose 36.3% to ₹1,026.70 crore and sales rose about 20% to roughly ₹6,780 crore. Volume growth was double-digit, and the EBITDA margin improved. Why it fell anyway: Expectations were already high, and some key numbers fell short of the Street, so there was no meaningful earnings beat. Inflation worries: Chairman Manish Tiwary said, “Rising inflation, particularly food inflation, is a reality.” Sugar and edible oil prices are elevated and cocoa remains volatile, so investors fear pressure on margins. Technicals have weakened. The October 16 close is below its 50-, 100- and 200-day moving averages (the 200-day is at ₹1,364.50). The stock is down about 7% over one month and 11% over three months, though still above its 52-week low of ₹1,159.40. Valuation: The stock trades above 60x earnings, which leaves little room for disappointment. Brokerages stayed cautious. Macquarie and Goldman Sachs kept Neutral ratings and cut their targets (Macquarie to ₹1,570). Morgan Stanley stayed Equal-weight but said the reaction looked excessive.