NESTLE Income Statement Analysis

 Operating income during the year rose 14.6% on a year-on-year (YoY) basis.

 The company's operating profit increased by 11.4% YoY during the fiscal.
Operating profit margins witnessed a fall and stood at 21.9% in CY22 as against
22.6% in CY21.

 Depreciation charges increased by 3.1% and finance costs decreased by 23.4%

YoY, respectively.

 Other income declined by 13.6% YoY.

 Net profit for the year grew by 12.8% YoY.

 Net profit margins during the year declined from 14.4% in CY21 to 14.1% in
CY22.

NESTLE Balance Sheet Analysis

 The company's current liabilities during CY22 stood at Rs 31 billion as compared to Rs

28 billion in CY21, thereby witnessing an increase of 11.4%.

 Long-term debt down at Rs 267 million as compared to Rs 275 million during CY21, a
fall of 2.9%.

 Current assets rose 26% and stood at Rs 35 billion, while fixed assets rose 0% and stood
at Rs 55 billion in CY22.

 Overall, the total assets and liabilities for CY22 stood at Rs 90 billion as against Rs 82
billion during CY21, thereby witnessing a growth of 9%.

NESTLE Cash Flow Statement Analysis

 NESTLE's cash flow from operating activities (CFO) during CY22 stood at Rs 27 billion,
an improvement of 22.4% on a YoY basis.
  Cash flow from investing activities (CFI) during CY22 stood at Rs -4 billion on a YoY
basis.

 Cash flow from financial activities (CFF) during CY22 stood at Rs -21 billion on a YoY
basis.

 Overall, net cash flows for the company during CY22 stood at Rs 2 billion from the Rs -
17 billion net cash flows seen during CY21.

Current Valuations for NESTLE

 The trailing twelve-month earnings per share (EPS) of the company stands at Rs 247.9, an
improvement from the EPS of Rs 219.7 recorded last year.

 The price to earnings (P/E) ratio, at the current price of Rs 19,598.8, stands at 78.5 times
its trailing twelve months earnings.
 The price to book value (P/BV) ratio at current price levels stands at 76.8 times, while the
price to sales ratio stands at 11.2 times.
 The company's price to cash flow (P/CF) ratio stood at 63.9 times its end-of-year
operating cash flow earnings.

Ratio Analysis for NESTLE

 Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.1x during CY22,
from 1.0x during CY21. The current ratio measures the company's ability to pay short-
term and long-term obligations.
Interest Coverage Ratio: The company's interest coverage ratio improved and stood at
22.1x during CY22, from 15.2x during CY21. The interest coverage ratio of a company
states how easily a company can pay its interest expense on outstanding debt. A higher
ratio is preferable.
  Profitability Ratios

Return on Equity (ROE): The ROE for the company declined and down at 97.2%
during CY22, from 108.8% during CY22. The ROE measures the ability of a firm to
generate profits from its shareholders capital in the company.
Return on Capital Employed (ROCE): The ROCE for the company declined and down
at 137.2% during CY22, from 155.0% during CY21. The ROCE measures the ability of a
firm to generate profits from its total capital (shareholder capital plus debt capital)
employed in the company.
Return on Assets (ROA): The ROA of the company improved and stood at 28.4%
during CY22, from 28.3% during CY21. The ROA measures how efficiently the
company uses its assets to generate earnings.

NESTLE Share Price Performance

Over the last one year, NESTLE share price has moved up from Rs 17,170.3 to Rs 17,376.8,
registering a gain of Rs 206.6 or around 1.2%.
Overall, the S&P BSE SENSEX is up 16.8% over the year.

What was the revenue of NESTLE in CY22? How does it compare to earlier years?

The revenues of NESTLE stood at Rs 170,042 m in CY22, which was up 14.4% compared to Rs
148,647 m reported in CY21.

NESTLE's revenue has grown from Rs 115,522 m in CY18 to Rs 170,042 m in CY22.

Over the past 5 years, the revenue of NESTLE has grown at a CAGR of 10.1%.

What was the net profit of NESTLE in CY22? How does it compare to earlier years?

The net profit of NESTLE stood at Rs 23,905 m in CY22, which was up 12.8% compared to Rs
21,184 m reported in CY21.

This compares to a net profit of Rs 20,824 m in CY20 and a net profit of Rs 19,684 m in CY19.

Over the past 5 years, NESTLE net profit has grown at a CAGR of 10.4%.
The cash flow statement of NESTLE reveals:

 Cash flow from operations increased in CY22 and stood at Rs 27,374 m as

compared to Rs 22,360 m in CY21.

 Cash flow from investments increased in CY22 and stood at Rs -3,917 m as

compared to Rs -19,203 m in CY21.

 Cash flow from financial activity decreased in CY22 and stood at Rs -21,227 m as
compared to Rs -20,200 m in CY21.

What does the Key Ratio analysis of NESTLE reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is

an important tool which helps in making investment decisions.

The ratio/financial analysis of NESTLE reveals:

 Operating profit margins witnessed a fall and stood at 21.9% in CY22 as against 22.6% in
CY21.

 Net profit margins declined from 14.4% in CY21 to 14.1% in CY22.

 Debt to Equity ratio for CY22 stood at 0.0 as compared to 0.0 in CY21.