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Nestle SA's stock has plummeted 25% this year, prompting J. Stern & Co. to increase its holdings, deeming the shares "far too cheap." Following the ousting of its CEO and reduced sales guidance, analysts are cautiously optimistic about a turnaround under new CEO Laurent Freixe, with expectations of a 20% stock rise in the next year. Despite the challenges, market sentiment suggests the selloff may have been excessive, particularly given Nestle's strong product portfolio in coffee, pet care, and nutrition.
Nestle India Ltd. stated that the suspension of Switzerland's 'most favoured nation' status for India will have "no impact" on its operations. This decision, stemming from a Supreme Court ruling, is a broader policy issue and not specific to the company, which already applies a 10% withholding tax on cross-border payments. Nestle India remains a significant market for the Swiss FMCG giant, having operated in the country for 112 years.
Goldman Sachs has initiated coverage on Nestle SA, assigning a Buy rating with a price target of CHF 86.00, citing the company's strong market position in lucrative sectors like coffee and pet care. Despite recent challenges, including rising cocoa and coffee prices, analysts predict robust organic sales growth of 4% and a solid dividend yield of 3.3%. The new CEO's strategic focus on innovation and integration is expected to enhance Nestle's growth trajectory moving forward.
Switzerland has suspended India's Most Favoured Nation (MFN) status effective January 1, 2025, citing a 2023 Supreme Court ruling regarding the Double Taxation Avoidance Agreement (DTAA) with Nestle. The Court determined that benefits from other countries' DTAAs cannot be claimed by Switzerland unless its own agreement is amended and notified under Indian law. This decision underscores the necessity of reciprocity in international tax treaties.
Nestle India’s stock is currently trading at Rs 2250.00, reflecting a minor decline of 0.16% for the day. The price has dipped below the 20-day Simple Moving Average of Rs 2252.67, suggesting a potential shift in market sentiment. The company boasts a market capitalization of Rs 217,272.82 and a price-to-earnings ratio of 67.15.
Switzerland has withdrawn the 'most favoured nation' status from India under the Double Taxation Avoidance Agreement, following a Supreme Court ruling that imposed a higher tax rate on Nestle. This move raises concerns about the credibility of India's commitments to foreign investors, especially as the Trade and Economic Partnership Agreement with EFTA is set for ratification. Indian officials suggest that the TEPA may take precedence over the DTAA, indicating potential renegotiations ahead.
Switzerland has revoked the Most Favoured Nation (MFN) status for India, effective January 1, 2025, following a Supreme Court ruling related to Nestle. This change, stemming from a disagreement over the interpretation of the Double Tax Avoidance Agreement, will increase tax on dividends for Indian firms, raising the rate from 5% to 10% for income earned post-2024, while prior earnings remain unaffected.
Switzerland has suspended the most favoured nation (MFN) status for India under their tax treaty, effective January 1, 2025, following a Supreme Court ruling that affects the enforcement of the Double Taxation Avoidance Agreement (DTAA). This change will result in higher withholding taxes for Indian companies operating in Switzerland, particularly impacting firms like Nestle. The Swiss authorities cited a lack of reciprocity in tax treatment as the reason for this decision, which may prompt other countries to adopt similar measures.
The global tea pod market, valued at $4.6 billion in 2022, is projected to reach $7.8 billion by 2032, growing at a CAGR of 5.5%. The rise in demand for herbal teas and the convenience of single-serve brewing systems are driving this growth, despite challenges related to consumer preferences for loose leaf tea. Key players include Nestle SA and Keurig Dr Pepper, with a focus on innovation and sustainable packaging to meet evolving consumer demands.
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