Nestle India rises 11 pc to Rs 438 cr in June quarter; to invest Rs 700 cr for setting up new plant

FMCG major Nestle India on Friday reported an increase of 10.83 per cent in net profit to Rs 437.84 crore for the second quarter ended June 30, led by sales and volume growth.

The company, which announced to invest around Rs 700 crore to set up a new factory in Sanand, Gujarat, had reported a profit of Rs 395.03 crore in the corresponding period of 2017-18.

Nestle would manufacture its range of popular instant noodles Maggi in the new factory and generate employment for around 400 persons, in which half of the strength would be women, it said in a statement.

The company, which follows January-December as its financial year, posted a net sales of Rs 2,982.83 crore, a rise of 11.35 per cent as compared with Rs 2,678.57 crore in the year-ago period.

"We have now delivered 10 straight quarters of volume and mix led growth. Our continuing momentum is a testimony to the unrelenting efforts of our employees, partners and other stakeholders, as well as to our quest for consumer relevant, science-based innovation and renovation," Nestle India Chairman and Managing Director Suresh Narayanan said.

Nestle's revenue from domestic sales in April-June 2019 was Rs 2,835.37 crore, up 13.08 per cent from Rs 2,507.33 crore a year earlier.

However, exports were down 13.88 per cent to Rs 147.46 crore as against Rs 171.24 crore a year ago.

Over the new plant, which would be Nestle India's ninth manufacturing facility, the company said it would soon commence construction.

"In line with our commitment to 'Make in India', we will soon commence construction of our newest, and ninth factory in India, at Sanand, Gujarat," Narayanan said.

This plant would be a "significant step" towards enhancing Nestle's manufacturing footprint in India, he added.

"This state-of-the-art environmentally sustainable factory for Maggi Noodles will involve an initial investment of nearly Rs 700 crore over the next two years, generate employment for about 400 people, where we are keen to embrace diversity through at least 50 per cent women employees," he said.

Nestle India had set up its first manufacturing facility in Moga (Punjab) in 1961.

The company has other units in Choladi (Tamil Nadu), Nanjangud (Karnataka), Samalkha (Haryana), Ponda and Bicholim (Goa), Pantnagar (Uttarakhand).

In 2012, the company set up its eighth manufacturing facility in Tahliwal (Himachal Pradesh).

Shares of Nestle India on Friday settled at Rs 11,427.85 apiece on the BSE, down 1.01 per cent from the previous close.