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Fast-moving consumer goods (FMCG) major Nestle India on Friday reported a 4.9 per cent year-on-year increase in net profits to Rs 688 crore in the third quarter of 2024-25 (FY25), driven by high double-digit growth in the beverages business.
The company had reported net profits of Rs 655.6 crore in the same period last year.
The company’s beverages retail business crossed Rs 2,000 crore in the last 12 months, with Nescafe (coffee) strengthening its leadership position.
However, the company flagged a sustained challenging demand environment in the country.
“It was a quarter marked by food inflation and moderation in urban consumption, with a gradual recovery in rural consumption,” Suresh Narayanan, chairman and managing director, said in an earnings release.
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The maker of Kitkat (chocolate) and Nescafe reported a 3.9 per cent increase in net sales to Rs 4,779.7 crore from Rs 4,600.4 crore in the year-ago period.
Its profit before interest, depreciation, and tax (PBIDT) fell 3.9 per cent to Rs 1,081.6 crore from Rs 1,125.4 crore in the same period last year.
“This quarter three of four product groups delivered healthy growth led by a combination of pricing and volume. Key brands continue to perform, and this augurs well in a challenging environment,” Narayanan added.
The company reported strong double-digit growth in its out-of-home business, with a significant acceleration in the food and beverages solutions portfolio.
“E-commerce continued its path of acceleration posting high double-digit growth and contributing 9.1 per cent to domestic sales. New products launched since 2015 now contribute to approximately 7 per cent of sales,” the release added.
The company’s manufacturing capacity will jump with the commissioning of the third confectionery unit in the Sanand (Gujarat) factory to manufacture Kitkat. Through this, the firm will take a step towards the target of Rs 5,800 crore capital expenditure between 2020 and 2025.
In its “commodity outlook”, the company said prices of coffee, cocoa and cereals and grains remained firm.
“Prices of edible oil have stabilised. Prices continue to remain stable for milk and packaging,” it added.
