Nestle India Reports Quarterly Profit Growth
Nestle India posted a marginal increase in second-quarter profit on Thursday, reportedly benefiting from improving urban demand for popular products including Maggi noodles and Nescafe coffee. According to reports, shares jumped about 5% to a one-year high following the earnings announcement.
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Financial Performance Details
The Indian subsidiary of Swiss food giant Nestlé stated that profit before exceptional items and tax edged up to 10.29 billion Indian rupees ($117.07 million) for the September quarter. Sources indicate the company had recorded a one-off gain of 2.91 billion rupees in the same quarter last year from the slump sale of certain businesses, making the current quarter’s underlying performance appear stronger.
Market Response and Industry Context
Analysts suggest that shares turned positive after the results were released, helping lift the Nifty consumer goods index by approximately 1%. The report states that Nestle India, along with peers including Hindustan Unilever and ITC, has noted an improvement in urban demand as disposable incomes benefit from sustained moderation in inflation and government tax cuts.
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Revenue Growth and Product Performance
Quarterly revenue at Nestle India climbed about 11% to 56.44 billion rupees, a significant improvement compared to last year’s 1.3% growth that was impacted by weak urban demand. According to the company’s statement, sales volume of its popular Maggi instant noodles grew in double digits, while Nescafe continued to lead the coffee category in India.
Expanding Product Categories and Distribution
Chocolate products including Munch and Milkybar also recorded strong gains, reportedly driven by new launches and the company’s increased focus on hyperfast delivery apps. These delivery platforms, which promise doorstep delivery of everyday essentials within minutes in major cities, have been consistently driving sales growth for consumer goods companies across the country.
Management Commentary and Future Plans
Newly appointed Managing Director and Chairman Manish Tiwary stated that domestic sales reached record highs. He added that the firm would continue investing in its brands and manufacturing capacity, though specific details weren’t provided in the report. The parent company, Nestlé, reportedly announced plans for 12,000 white-collar job cuts globally as part of efficiency measures, though it remains unclear if these cuts will affect operations in India.
Broader Economic Context
The improved performance comes amid broader economic developments including what sources describe as modest economic growth in other markets and increasing focus on technology investment trends. Meanwhile, environmental concerns continue with reports of record atmospheric carbon dioxide levels and climate warnings from advisory bodies, while technology firms like TSMC report strong performance in related sectors.
This coverage is based on reporting from Reuters content partners and should not be considered as financial advice.
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