KUALA LUMPUR: Nestlé (M) Bhd share price rose on Friday, Aug 27 after OSK Research raised its target price for the stock to RM38.53 from RM31.49 previously, and maintained its neutral recommendation on the stock.

At 9.15am, Nestlé was up 40 sen to RM39.88.

In a note on Friday, Aug 27, OSK Research said Nestlé's 1HFY10 earnings were above its own and consensus estimates, making up 61.8% of the research house's full-year forecast.

It said Nestlé's year-on-year earnings swelled 28.6% on the back of improving export sales, mainly from its new coffee and non-dairy creamer lines in Shah Alam.

"Earnings before interest and tax margins rose from 12.9% to 14.5%. Meanwhile, quarter-on-quarter earnings declined 27.8% as marketing expenses rose during the quarter, with new products such as Nescafe Ipoh White Coffee and Maggi whole wheat noodles being launched.

"We revise upwards our earnings forecasts for FY11 and target price to RM38.53 from RM31.49. Maintain Neutral," it said.