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Business News/ News / India/  Nestle India June qtr profit up 36.8%
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Nestle India June qtr profit up 36.8%

The company renewed and accelerated focus on brand building and continued to make relevant investments during the quarter.

Revenue from operations were up 15% to ₹4,658 crore with domestic sales up by 14.6% year-on-year.Premium
Revenue from operations were up 15% to 4,658 crore with domestic sales up by 14.6% year-on-year.

New Delhi: Nestle India on Thursday reported a 36.8% jump in June quarter profit. Standalone profit grew to 693.3 crore for the three months ended 30 June from 510 crore in the year ago period.

Revenue from operations were up 15% to 4,658 crore with domestic sales up by 14.6% year-on-year.

Ebitda grew by 25.4% year-on-year; margins expanded by 186 bps year-on-year. Shares of Nestle India were down 2.08% on the BSE at the end of trading hours on Thursday.

All product groups registered a double digit growth, the company. The company renewed and accelerated focus on brand building and continued to make relevant investments during the quarter.

“This is the fifth quarter in a row of double-digit growth across all product groups. Domestic sales growth is broad based and grew by 14.6%, on the back of prudent pricing and supported by mix and volume with targeted brand support. Key brands continued to perform well, led by Kitkat, Nescafe and Maggi among others," Suresh Narayanan, chairman and managing director, Nestlé India. “The out-of-home business continued to deliver strong growth this quarter, through a pivot of dual strategies in terms of portfolio transformation and robust precise execution of differentiated channel and geography plans to harness big growth opportunities. Our RURBAN strategy was helped by increasing distribution footprint with relevant portfolio, thereby achieving higher penetration. We witnessed strong growth across mega cities and metros, robust performance in Tier 1 to 6 towns and continued strength in rural markets," Narayanan said.

Meanwhile, analysts said Nestle domestic volumes were below estimates. “Nestle saw a moderation in volume growth which led to a revenue miss, while realization was a bigger revenue growth driver. However, input price correction aided, and both gross and Ebitda margin came in ahead of our forecasts. The revenue growth was broad-based across cities and towns and also product segments, analysts at Jefferies said.

Nestle said commodities such as edible oils, wheat and packaging materials have been in the lower price range. “A reversal of price trend is noted in fuels with prices softening in second quarter after reaching higher level towards the end of quarter one. In fresh milk, there has been price stability. Robusta prices are elevated and are expected to remain volatile," it said commenting on commodity outlook.

The company has received an “in principle" approval from Industrial Promotion & Investment Corporation of Odisha Limited (IPICOL) to set up its 10th factory in the country.

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Published: 27 Jul 2023, 10:45 PM IST
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