Nestle India at all-time high in wary markets

Nestle India, majorly known for its Maggi noodles, is trailing at its all-time high level, in an otherwise weak market. This BSE 100 company is engaged in food business with packaged food items ranging from milk products like Neslac, Beverages like Nescafe, chocolates and confectionery products like Kitkat, Barone, Munch and Eclairs.

All-in-all, this FMCG company has surged against the markets with its robust fundamentals and strong upside momentum and volumes. The company saw a revival in top line and bottom line Jan-Dec 2016 year and has continued with the same on TTM basis, where currently the TTM revenue and PAT posted a growth of 8.5 per cent and 32.2 per cent, respectively.

Considering the broader time frame, the stock had given a Cup and Handle pattern breakout in November 2017 at 7,240 levels and had surged near to 8,000-8,040 levels and resisted near those levels in December and January. The stock fell nearly 14 per cent post that till February 8, 2018. Thereafter the stock bounced back and breached its multiple resistance at 8,000-8,040 and is now trailing at 8,200 levels. Significant volumes and 14-period RSI trendline breakout at 60 suggest upside momentum to continue in the near to medium term. With this, we may see 800-1,000 points upside in the stock.