By Pradeep Saran | Published: Oct 18, 2024
Nestlé India’s Q2 FY25 results show a slight dip in net profit to ₹899 crore. Revenue increases marginally by 1.3% as the company faces high commodity prices. Learn more about the performance.
Nestlé India Reports Q2 Results: Net Profit Marginally Falls to ₹899 Crore
Nestlé India announced its Q2 FY25 results on October 17, 2024, showing a slight decrease in net profit. The company’s net profit for the quarter stood at ₹899 crore, down from ₹908 crore in the same quarter last year. Revenue from operations rose 1.3% to ₹5,104 crore compared to ₹5,037 crore in Q2 FY24.
Key Financials at a Glance
- Net Profit (Q2 FY25): ₹899 crore (down from ₹908 crore in Q2 FY24)
- Revenue: ₹5,104 crore (up 1.3% YoY)
- Shares Performance: Nestlé India shares dropped by 1.8%, trading at ₹2,418.1 per share as of 12:10 pm on October 17.
Despite facing challenges like subdued consumer demand and elevated commodity prices, particularly for coffee and cocoa, Nestlé India showed resilience. According to Suresh Narayanan, Chairman and Managing Director of Nestlé India, five of the company’s top twelve brands achieved double-digit growth this quarter. However, some brands did experience pressure due to the soft market, and the company is working on robust action plans to address this.
Commodity Prices and Challenges
High commodity prices, especially for coffee, cocoa, cereals, and edible oils, continue to impact the company. However, stability in milk prices and packaging materials has provided some relief.
Nestlé’s beverages business, driven by brands like NESCAFÉ CLASSIC, NESCAFÉ SUNRISE, and NESCAFÉ GOLD, saw strong double-digit growth. The company also noted that its e-commerce division grew by almost 38%, with brands like KITKAT, MAGGI, and MILKMAID contributing to this success.
Swiss Parent Company’s Performance
Meanwhile, Nestlé’s Swiss parent company revealed that it is revamping its leadership and operational structure. The parent company also lowered its sales outlook for 2024, anticipating a 2% organic sales growth, amid continuing price hikes that have limited volume increases.
Conclusion
Although Nestlé India has faced several headwinds due to rising commodity costs, the company remains focused on maintaining growth, with several of its top brands performing well. With strategic action plans in place, Nestlé India aims to overcome challenges and continue delivering value to its shareholders.
Key Takeaways
- Net profit decreased slightly due to rising commodity prices.
- Revenue from operations saw a modest growth of 1.3%.
- Key brands like NESCAFÉ and MAGGI drove strong growth in specific sectors, particularly through e-commerce and out-of-home consumption.
