KUALA LUMPUR (Feb 27): CIMB IB Research has maintained its “Reduce” rating on Nestle (M) Bhd at RM149 with a higher target price (TP) of RM110.80 (from RM97.40) and said Nestle’s FY18 core net profit of RM669.9 million (+6% y-o-y) was broadly in line with house forecast (97%) but below Bloomberg consensus (95%).

In a note Feb 26, the research house said Nestle’s 4Q18 core net profit declined 9.7% q-o-q, owing to lower sales q-o-q after the zero-GST period in 3Q18 and a higher tax rate (+4.9 percentage points q-o-q).

“Maintain Reduce with a higher TP of RM110.80 (roll over valuation to FY19),” it said.