Revenue from operations rose 9.05% year on year to Rs 5267.59 crore in the quarter ended 31 March 2023.
The company had earlier informed the exchanges about changing the financial year from “1st January - 31st December” cycle to “1st April - 31st March” cycle. Accordingly, the current financial year of the company stands extended up to 31 March 2024, covering a period of 15 months commencing from 1 January 2023 to 31 March 2024, comprising five quarters.
Total sales increased by 9.28% YoY to Rs 5,254.43 crore in the January-March 2024 period. During the quarter, domestic sales grew by 8.86% and export sales rose 15.96%.
Profit before exceptional items and tax was at Rs 1,240.50 crore in the March quarter, up 25.24% from Rs 990.46 crore posted in January-March quarter 2024.
The company recognized an exceptional item of Rs 10.08 crore for the quarter ended 31 March 2024. This partially reverses a one-time expense of Rs 107.30 crore recorded in the December 2023 quarter due to changes in the cost of servicing the company's pension plan. This reversal reflects the transfer of responsibility for making monthly pension payments to an insurance service provider.
Suresh Narayanan, chairman and managing director of Nestlé India, said, “I am pleased to share that we have delivered double-digit growth, despite challenges posed by rising food inflation and volatile commodity prices. We have witnessed a strong growth momentum across our product portfolio led by a combination of pricing and mix. Our domestic sales crossed Rs 5,000 crore this quarter.
In the financial year ended 31 March 2024, confectionery delivered strong performance, fuelled by KITKAT, making India the second-largest market for the brand globally. Our Beverages business recorded robust performance. NESCAFÉ has introduced its coffee to over 30 million households in India in the last 7 years. Milk Products and Nutrition witnessed strong growth despite inflationary pressures. Prepared dishes and cooking aids registered strong growth across portfolio led by MAGGI Noodles and MAGGI Masala-ae-Magic. India emerged as the largest market worldwide for MAGGI.
The Out-of-Home business reported strong growth and e-commerce sustained its upward trajectory, contributing to 6.8 % of sales. We remained steadfast on our RUrban journey and expanded to encompass over 200,000 villages, marking a significant milestone in our journey.
The pursuit of new platforms and categories is a key component of Nestlé India's overall growth strategy and reflects our commitment to anticipating and responding to evolving market trends and consumer preferences.”
Meanwhile, Nestle India’s board has approved the execution of a definitive agreement to form a joint venture between the company and Dr. Reddy’s Laboratories to bring together the well-known global range of nutritional health solutions as well as vitamins, minerals and health supplements of Nestlé Health Science with the nutraceuticals portfolios, strong and established commercial strengths of Dr. Reddy’s in India and other geographies. The joint venture is expected to become operational in the second quarter of the financial year 2024-25, subject to customary closing conditions.
The joint venture company would be formed with Dr Reddy’s holding 51% and Nestlé India’s holding 49%. Nestlé India will have a call option to increase shareholding upto 60% after six years at a fair market value. Dr Reddy’s shall continue to hold at least 40% of the shareholding after the company exercises its call option, it added.
On its commodity outlook, the company stated, “Commodity prices are seeing unprecedented headwinds in coffee and cocoa with all time high prices and an ongoing price rally. Cereals and grains are going through a structural cost increase backed by MSP. Milk prices expected to rise on account of expected harsh summer.”
Further, the firm's board has recommended a final dividend of Rs 8.50 per equity share for FY2024. The record has been fixed on 15 July 2024.
Nestlé is the world's largest food and beverage company. It manufactures internationally famous brand names such as Nescafé, Maggi, Milkybar, Kit Kat, Bar-One, Milkmaid and Nestea.