Nestle India's Profit Drops 4% In June Quarter

The net profit stood at INR 515.34 crore during the period under review compared with INR 538.58 crore in the year ago period

By
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Nestle India Ltd on Thursday reported a 4.31 per cent decline in its net profit for the second quarter ended June 30, 2022. The net profit stood at INR 515.34 crore during the period under review compared with INR 538.58 crore in the year ago period. However, the company's sales growth crossed INR 40 billion for the second quarter. The company follows the January-December financial year.

Pexels

"I am pleased to share that we have continued to deliver robust sales growth this quarter and breached the INR 40 billion (4,000 crore) mark. This is attributable to the resilience of my team and the tenacity of our partners. Our endeavor this quarter was to secure our 'engines of growth' in this inflationary context and to enable sharp overall business recovery when the pressures abate," said Suresh Narayanan, chairman and managing director, Nestlé India.

"The growth is broad based and while being primarily driven by pricing has a healthy underlying volume and mix evolution, I am also happy to share that the 'out of home' space got back to accelerated growth in channels such as hotels, education centers and workplaces. As far as channels are concerned, 'organized trade' saw broad based growth across consumers and categories," he added.

The milk products and nutrition category witnessed a double-digit growth across brands with Milkmaid leading the way. The confectionery category led by Kitkat and Nestlé Munch saw a double-digit growth. The beverages category turned in another double-digit growth across channels based on the pivotal equity of Nescafe and a consistent strategy of customized communication in the summer, as well as driving penetration and distribution. The Foods category continued its strong double-digit streak of growth, with improved market share in Maggi noodles.

"We continued to see strong momentum in megacities and metros, as well as strong acceleration across smaller town classes. We are also heartened by a smart uptick in sales in rural markets this quarter which augurs well for a credible momentum in future," the chairman added.