Nestle India posted a net profit of ₹934.17 crore in the March quarter, up 26.81 per cent over the same period in the previous fiscal. Total sales stood at ₹5254.43 crore, up 9.27% for the quarter under review.
The Swiss packaged food major said it has entered into a definitive agreement to form a joint venture with Dr. Reddy’s Laboratories Ltd in the nutraceuticals space. At the same time, the company also stated that it will launch Nespresso machines and capsules portfolio by the end of 2024. This will be sold through its distribution network, online channels, and boutiques under commercial arrangements with Nespresso and third parties.
- Also Read: Hyundai Group’s CEO reviews India expansion & conducts first townhall meeting outside Korea
In a statement, Suresh Narayanan, Chairman and Managing Director, Nestlé India said, “We have delivered double-digit growth, despite challenges posed by rising food inflation and volatile commodity prices. We have witnessed a strong growth momentum across our product portfolio led by a combination of pricing and mix. Our domestic sales crossed ₹5,000 crore this quarter, a notable milestone for us. I would like to extend my heartfelt gratitude to my colleagues, distributors, retailers and partners for their unwavering dedication, determination, and diligence.”
He added that the prepared Dishes and Cooking Aids segment registered strong growth across the portfolio led by Maggi Noodles and Maggi Masala-ae-Magic. “India emerged as the largest market worldwide for Maggi,” he added.
“In the financial year ended 31st March 2024 (15 months), confectionery delivered strong performance, fuelled by Kitkat, making India the second-largest market for the brand globally. Our Beverages business recorded robust performance. Nescafe has introduced its coffee to over 30 million households in India in the last 7 years. Milk Products and Nutrition witnessed strong growth despite inflationary pressures,” Naryanan said.
The company said that its out-of-home business reported strong growth and e-commerce sustained its upward trajectory, contributing to 6.8% of sales. “We remained steadfast on our RUrban journey and expanded to encompass over 200,000 villages, marking a significant milestone in our journey,” he added.
On the JV with Dr. Reddy’s, Narayanan said that the JV will enable Nestle “to bring our science-backed nutritional solutions to more consumers across the country by leveraging Dr. Reddy’s robust retail and distribution network.” Dr. Reddy’s is a trusted name in the pharmaceutical space and shares our commitment to provide access to high quality products. The joint venture company would be formed with Dr Reddy’s holding 51% and Nestlé India’s holding 49%. Nestlé India will have a call option to increase shareholding upto 60% after six years at a Fair Market Value. Dr Reddy’s shall continue to hold at least 40% of the shareholding after the Company exercises its call option,” he added.
On Nespresso portfolio launch, he added, “In recent years, coffee consumption in India has witnessed a surge, with a discernible trend towards in-home consumption. India is one of the fastest-growing coffee markets for Nestlé. The first Nespresso boutique is intended to be opened in Delhi, before expanding to other key cities. Nespresso will also be sold online through e-commerce platforms.
The company’s board recommended a final dividend for the fifteen months financial year ended 31st March 2024 of ₹8.50 per equity share (face value of ₹ 1/- each) amounting to ₹8,195.3 million, it added.