The Hindu Business Line : Nestle to invest Rs 600 crore in India next year

New Delhi, Sept. 26 Nestle India Ltd unveiled its capital expenditure of Rs 600 crore in 2009, which is double the Rs 300 crore that it is investing in the current year.

“The investment would go in new research and development, advertising and capacity building,” the company Chairman and Managing Director, Mr Martial Rolland, said while addressing a press conference here on Friday.

The Nestle International Chairman, Mr Peter Brabeck-Letmathe, who is leading a high-powered delegation of the company’s board to India, reiterated the FMCG major’s intention to “reinvest and expand” here.

“There is no envelope or limit. In the years to come, there will be no limit to our investments in India and we are willing to invest as much as is strategically and economically sound. The board has assured all financial resources; whatever Nestle India needs to continue to serve the consumer,” he said and pointed out that that the country is one of the fastest growing markets for the company worldwide. Nestle’s sales in India grew by 25 per cent in the first half of 2008 with the country contributing 1.5 per cent of its global turnover.

Commenting on the Indian growth story, the CEO of the Swiss food major, Mr Paul Bulcke, who accompanied the Chairman, said, “Developing countries are developing. For many, many years, it was just a classification, rather than dynamic.”

However, now, the developing markets account for a third of Nestle’s business, which is expected to grow to 40-45 per cent. In 10 years, Nestle is expecting a billion new consumers for its products which range from coffee, dairy to processed food and confectionary.

Nestle’s USP has been not just designing products for this bottom of the pyramid consumers but entire strategies. For example, the company enriched its products for the Brazil markets, where anaemia is rampant. In India too, the company has set up a facility in Uttarakhand which is dedicated to developing products below Rs 10. Currently, Nestle’s top selling Maggi is manufactured there.

Mr Brabeck-Letmathe, who joined Nestle in 1968 and has worked his way to the very top becoming the Chairman of the company in 2005, pointed out that the company had been in India since 1912 and would soon celebrate a hundred years here.