Nestle India reports 6.5% decline in net profit
This drop is attributed to factors such as food inflation and moderated urban consumption.
INDIA – Nestle India, a regional operator of the multinational Nestle, has reported a 6.5% YoY decline in consolidated net profit for Q4 FY25, reaching Rs 873 crore (US$102.23 million) compared to Rs 934 crore (US$109.37 million) in the same quarter last year.
Revenue from operations for the quarter rose 4.5% YoY to Rs 5.5 crore (US$664,050), up from Rs 5.2 crore (US$608,920) a year ago, driven by stable domestic sales and a marginal export recovery.
Consolidated revenue from operations stood at Rs 20.2 crore (US$ 2.7 million), a 3.3% increase over Rs 19.5 crore (US$2.28 million) in FY24.
According to the BSE filing, net profit for FY25 remained flat at Rs 3.2 crore (US$374,720), compared to Rs 3.19 crore (US$373,549) last year.
Total expenses for Q4 rose to Rs 4.3 crore (US$503,530), with higher raw material costs and employee benefits pushing up operational expenditure. EBITDA margin contracted slightly, reflecting cost pressures.
The confectionery-maker also booked exceptional gains of Rs 183 crore (US$21.43 million) for the year, aiding its bottom line despite muted growth. Export sales for the year touched Rs 785 crore (US$91.92 million), maintaining parity with the previous year.
The report comes after the company increased the prices of its products slightly to address the rising costs of coffee, cocoa, and edible oil, aiming to keep sales coming in.
The initiative comes as profits decline due to consumer inflation and high commodity prices. The company aims to keep increases minimal while awaiting the potential boost in consumption from upcoming personal income tax cuts.
Nestle India Managing Director Suresh Narayanan said, “Profits at Corporate India came under pressure in the October- December quarter due to the double whammy of consumers cutting back due to inflation in large cities and high commodities prices. Wherever price increases are essential, we must take some pricing action.”
As reported by the Economic Times, India’s plan to cut personal income tax rates in the fiscal year 2026, unveiled earlier this month, is expected to put more disposable income in the hands of the people and eventually boost consumption.
Last month, the company reported a smaller-than-expected quarterly profit, hit by a slowdown in consumer spending in major cities and higher product prices.
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