Nestle India Reports 5% Decline in Q4 Profit Due to Rising Input Costs and Export Drop
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Synopsis
Nestle India Limited reported a 5% YoY decline in Q4 net profit to Rs 885.4 crore due to rising raw material costs and an 8.65% drop in exports. Despite these challenges, domestic sales rose by 4.2%, reaching an all-time high.
Key Takeaways
- Net profit fell by 5% YoY to Rs 885.4 crore.
- Export sales declined by 8.65% YoY.
- Domestic sales reached a record Rs 5,235 crore.
- Cost inflation remains a significant challenge.
- Final dividend of Rs 10 per share declared.
New Delhi, April 24 (NationPress) - FMCG giant Nestle India Limited announced a 5% year-on-year (YoY) decrease in net profit, amounting to Rs 885.4 crore for the January–March quarter (Q4) of FY25. This decline is attributed to escalating raw material expenses.
The company encountered increasing pressure from the rising prices of essential commodities like coffee, cocoa, and milk, which adversely affected profitability during the quarter, as stated in its filing to the stock exchange.
Export revenues also experienced a significant drop of 8.65% YoY, which contributed to an overall sales growth reduction to 3.7%, despite a slight uptick in domestic demand.
Ongoing cost inflation remained a significant hurdle. While edible oil prices held steady, the soaring costs of coffee, cocoa, and milk—especially with summer approaching—exerted additional pressure on the company's financial performance.
Nestle India indicated that profitability was compressed while striving to sustain momentum in its main product categories.
“Volume growth serves as a robust indicator of consumer resilience and enhanced sentiment in a tough macroeconomic environment,” remarked Suresh Narayanan, Chairman and Managing Director of Nestle India.
“Nonetheless, persistent cost inflation has continued to challenge profitability,” Narayanan added, noting that ongoing investments in innovation and distribution are crucial for increasing market share across categories.
Despite these challenges, the company registered a 4.2% YoY increase in domestic sales, hitting an all-time high of Rs 5,235 crore.
This growth was bolstered by improved consumer sentiment and heightened volume sales, particularly in urban markets and within core food and beverage sectors.
The company also announced a final dividend of Rs 10 per equity share for FY25, with the record date set for July 4 and payments commencing from July 24.
This dividend follows earlier interim distributions made throughout the financial year, as outlined in the company's filing.
The FMCG leader stated that growth in its e-commerce segment was fueled by enhanced product availability, customized online packaging, and targeted media advertising.
