Nestle, the world s largest packaged food company, faces significant challenges in commodity prices, particularly in coffee and cocoa, which are at all-time highs with an ongoing price rally. Additionally, milk prices are expected to rise due to harsh summer conditions, while cereals and grains are experiencing structural cost increases supported by minimum support prices (MSP).
The infrastructure investment of Rs 11 trillion committed by the government in the recent vote-on-account budget will fuel job creation and household incomes, “a lot of which will be flowing into consumption of essentials”, Suresh Narayanan said at a select roundtable here on Thursday.
Analysts say that the softening prices of edible oils and packaging, coupled with no discounts, will enable the company to override any pressure on margins.
Nestle India delivers the highest growth in a quarter in the last decade. In Q1 of 2023, the company s PAT stood at ₹737 crore up by 24.7% YoY, while net sales soared by 21.3% YoY to ₹4,808 crore. Also, the company posted double-digit growth across all products in the last four quarters.