Newsletter
Nestlé India served a strong quarter, with solid sales and profit growth, even as margins took a hit from higher ad spends. The stock jumped up to 3% post results but gave up some gains by close.
By the numbers
- Revenue up 18.5% YoY at ₹5,667 crore, the highest-ever quarterly sales for Nestlé India
- Adjusted profit at ₹1,018 crore, up 46% YoY, helped by a one-time tax gain of ₹202 crore
- EBITDA margin: 21.1%, down 200 bps from 23.1% last year
What worked: this was a volume-led win. Nestlé clocked its highest volume growth in five years, with confectionery leading the charge in double digits.
Strong advertising, wider product range, deeper rural reach, premium offerings, and the quick-commerce push helped drive demand across categories.
What pinched: Margins took a hit as Nestlé spent aggressively on brand building. Higher ad spends and costs linked to new labour codes (₹10 crore) and severance (₹35 crore) weighed on profitability, even after the tax write-back cushion.
Zoom out: India’s FMCG sector is slowly shifting gears, from price hikes to volume-led growth. Demand is improving, but input costs like milk and edible oils remain sticky.
Companies with strong brands and distribution, like Nestlé, are better placed to absorb cost pressures while keeping growth simmering.
