Nestle India falls after hike in royalty fee for parent

Colgate-Palmolive (India)

08/04/2024 10:28

** Shares of Nestle India  NEST.NS  down 1.7% at 2,495
rupees; co among top losers in Nifty 50 index  .NSEI 
    ** Co hikes royalty fee for parent Nestle  NESN.S  to 5.25%
by 75 basis points over next 5 years
    ** While near-term impact of royalty hike on earnings is
marginal, shorter duration of agreement leaves ambiguity around 
further hikes - Axis Capital
    ** Nestle's royalty rate will surpass that of Colgate
 COLG.NS  (4.9%) over five years and will be 180 bps higher than
Hindustan Unilever's  HLL.NS  royalty rate of 3.45% - brokerage
    ** Nestle India shares down 6.2% YTD vs 5.3% fall in Nifty
FMCG index  .NIFTYFMCG 
    

 (Reporting by Sethuraman NR in Bengaluru)
 ((Sethuraman.NR@thomsonreuters.com; (+91 9945291420); Reuters
Messaging: nallur.sethuraman.thomsonreuters.com@reuters.net))