Nestle India recorded the highest growth for the Company in a quarter in the last 10 years, excluding the exceptional quarter in 2016 which was off a low base in 2015.
The Board of Directors of Nestlé India today approved the results for the first quarter of 2023. Nestle India has continued to deliver robust sales growth this quarter, which is broad based with a healthy balance of pricing, volume, and mix, the company said in a statement.
Suresh Narayanan, chairman and managing director, Nestlé India, said, “Yet again, I would single out the outstanding diligence, commitment and seizing of every opportunity in the marketplace by our employees, partners, distributors, and stakeholders. Teamwork has triumphed once again!”
All product groups delivered double digit growth, a notable feature in these past four quarters in a row. Confectionery led by KITKAT, and MUNCH posted a strong growth, supported by consumer led campaigns, innovation and engagement.
Beverages turned in another quarter of robust growth and market share gains led by NESCAFÉ Classic, NESCAFÉ Sunrise, and NESCAFÉ GOLD. Prepared Dishes and Cooking Aids delivered strong growth across all products in its portfolio. One can discern portfolio upgradation happening in this category. Milk products and Nutrition continued its strong performance led by MILKMAID among others.
“I am very pleased that in line with our commitment to enable people live healthier lives, we launched ThickenUp Clear, a food and beverage thickener from our Nestlé Health Science portfolio. ThickenUp Clearcan be used to help patients with swallowing difficulties especially in oropharyngeal dysphagia. I feel proud of the Company’s efforts to make a difference, where it matters to improve their quality of life,” said Narayanan.
The Out-of-Home business continued to accelerate rapidly this quarter. The company continued with portfolio transformation, continued expansion, route to market focussed on relevant geographies, channel prioritization and opening of new kiosks in key locations. A strong performance in e-Commerce continued with significant growth in quick commerce. Narayanan added, “We accelerated our sustained growth journey in RURBAN. The growth in RURBAN was complemented by strong momentum in metro and mega cities. Rural growth was also strong, secular and robust, being volume led which gives greater confidence and impetus to our efforts to enhance our footprint.”
Financial Highlights – Q1 2023:
Total Sales of INR 4,808 Crore.
Total Sales Growth at 21.3%. Domestic Sales Growth at 21.2%.
Profit from Operations at 21.0% of Sales.
Net Profit of INR 737 Crore.
Earnings Per Share of INR 76.4.
Interim Dividend INR 27.00 per equity share declared on 12th April, 2023.
Business Comments – Q1 2023:
E-Commerce: The channel delivered strong performance with significant growth in quick commerce.
Organized Trade: The channel witnessed broad based growth across product groups in retail business fuelled by rapid outlet expansion.
Out-of-Home (OOH): The channel posted strong performance. Growth has been secular across brands, geographies, and channels.
Exports: Strong double-digit growth of product portfolio in global markets through both mainstream and ethnic channels.
Product Group Performance – Q1 2023 (Domestic):
Prepared Dishes and Cooking Aids: Delivered strong growth across all products in its food portfolio. Growth momentum was aided by market presence, media campaigns and focussed consumer activations.
Milk Products and Nutrition: Registered strong double-digit growth, despite commodity pressures. GERBER Cereals and CEREGROW Grain Selection performed well. Strong growth in MILKMAID. Launched ThickenUp Clear.
Confectionery: Displayed robust growth led by KITKAT and MUNCH. Performance was supported by focused trade plans and strong consumer engagement.
Beverages: Continued to witness robust growth.NESCAFÉ recorded its highest ever market share. NESCAFÉ RTD and out-of-home also delivered strong growth.
Pet Food: Continued to build on its momentum and launched new product within its cat portfolio.
Commodity Outlook in Short to Medium Term
Witnessing early signs of softening of commodities such as edible oils, wheat and packaging materials. However, cost of fresh milk, fuels, and green coffee are expected to remain firm because of continued increase in demand and volatility.