Nestle India Q2 profit falls 17%, revenue up 10.6% on strong volumes

Maggi, Nescafe, and e-commerce power double-digit growth

Fast-moving consumer goods (FMCG) major Nestlé India reported a 17.4 per cent year-on-year drop in net profit to ₹743.2 crore in the July-September quarter, as the same quarter last year included an exceptional item. The company had posted a net profit of ₹899.5 crore in the year-ago period.

 

The maker of Maggi noodles and Nescafé coffee saw net sales rise 10.6 per cent to ₹5,643.6 crore from ₹5,104 crore a year ago, driven by double-digit volume growth.

 

“I am happy to report that domestic sales grew at a double-digit rate, led by volume growth. Three out of four product groups delivered strong, volume-led double-digit growth. Our domestic sales reached ₹5,411 crore, the highest ever recorded in any quarter,” said Manish Tiwary, chairman and managing director of Nestlé India, completing his first quarter at the company.

 

 

“Our penetration-led volume growth strategy ensures we are present across diverse geographies and platforms, making our products accessible to consumers wherever they are. To support this vision, we will accelerate investments in brands and manufacturing capacity, bringing forth innovations that are bolder, bigger, and better. In all our endeavours, we will remain ‘Fast, Focused, Flexible’, adapting to market dynamics as they evolve,” he added.

 

On the recent goods and services tax (GST) rate cuts, Tiwary called the move positive for consumers.

 

“It is expected to stimulate consumption, drive affordability, and contribute to the overall growth of the FMCG sector and the economy. We have been working closely with our partners, distributors, wholesalers, and retailers to pass on the benefits of the revised GST rates across our product groups,” he said.

 

The company’s confectionery segment grew at a strong double-digit rate, driven by underlying volume growth. KitKat emerged as the largest growth driver, gaining market share, while Munch and Milkybar also posted high double-digit growth.

 

The powdered and liquid beverage segment delivered another quarter of high double-digit growth, with Nescafé continuing to lead the coffee category by increasing market share and household penetration.

 

The prepared dishes and cooking aids segment registered strong double-digit value growth, supported by accelerated volume growth. Maggi noodles saw double-digit volume gains.

 

The e-commerce business accelerated in quick commerce, aided by festival integrations, product launches, targeted demand generation, and improved platform availability.

 

Looking at commodities, the company expects milk prices to soften after the festival season, coinciding with the onset of the flush season.

 

“Coffee prices are anticipated to stabilise and may decline as upcoming crops in Vietnam and India appear normal. Global cocoa supply and demand are projected to balance, mainly due to a correction in demand over the past two years,” the release said, adding that edible oil prices are expected to remain firm and could rise further due to tight global supply and demand.