Nestle India gains as Q4 PAT surged 65% YoY to Rs 628 cr

Nestle India advanced 2.32% to Rs 19,692.30 after the FMCG major reported 65.5% jump in net profit to Rs 628.06 crore on 13.58% rise in revenue from operations to Rs 4,256.79 crore in Q4 CY22 over Q4 CY21.

Total sales increased 13.96% year on year to Rs 4,233.27 crore in Q4 CY22 against Q4 CY21. Domestic sales and export sales for the quarter ended December 2022 rose by 13.83% and 17.07% respectively. Domestic sales growth was broad based.

The company's profit before tax (PBT) surged 71.81% to Rs 859.07 crore in Q4 CY22 from Rs 500 crore recorded in the same period a year ago.

Total expenses increased 12.78% year on year to Rs 3,427.27 crore in Q4 CY22 over Q4 CY21. Cost of raw material consumed was Rs 2,006.02 crore (up 20.63% YoY) while employee benefits expense stood at Rs 406.95 crore (up 4.64% YoY) in the quarter ended 31 December 2022 as against the corresponding quarter previous year.

The company's net profit grew 12.85% to Rs 2,390.52 crore on 14.63% increase in revenue from operations to Rs 16,896.96 crore in CY22 over CY21.

Total sales and domestic sales for the year advanced 14.5% and 14.8%, respectively. Domestic sales growth was broad based with a healthy balance of pricing and volume. Export delivered growth of 8.2% for the full year as it continued to expand its presence in new markets through both traditional and mainstream channels.

Commenting on the results, Suresh Narayanan, chairman and managing director of Nestle India said, We delivered our highest double‐digit growth in a decade led by sustained volume and mix led growth, leading to a strong value growth. In 2022 totalsales grew by 14.5% and domestic sales increased by 14.8%, with broad based performance across all categories. Our robust performance on e‐commerce continued, fuelled by Quick Commerce and Click & Mortar. Out‐Of‐Home (OOH) business made a strong comeback in 2022, recovering its pre‐covid base and delivering robust growth by revamping, resetting geography, channel and sales priority. We launched our first ever 'direct to consumer' (D2C) platform - www.mynestle.in where products manufactured by the company in India are available in Delhi - NCR.

He added, Premiumization is one of the growth engines that will lead to future acceleration of the business.

In its commodity outlook, the company said that the key categories such as cereals, grains and coffee continued to be at a 10‐year high. Edible oil too was at a 10‐year high and moderated towards the last quarter. Fresh milk prices continued to remain firm due to lumpy skin disease in H2 2022 and rise in feed costs to farmers. With some respite in crude oil, input materialssuch as packaging have witnessed relief. Demand continued to be robust with domestic outlook of prices evolving because of supply and weather conditions.

Meanwhile, the board of directors recommended final dividend of Rs 75 per equity share for the year 2022. The record date fixed for the same is fixed on 21 April 2023. The final dividend, if approved by the members at 64th AGM, shall be paid on and from 8 May 2023.

Further, the company's board appointed Svetlana Boldina, as an additional director and whole-time director, designated as 'executive director - finance & control and chief financial officer" (key managerial personnel), effective from 1 March 2023 for a term of five consecutive years, subject to requisite approvals, in place of David McDaniel.

The company added that David McDaniel will cease to be whole-time director, designated as executive director - finance & control and chief financial officer, with effect from the close of business hours on 28 February 2023 as he will be taking up a new assignment with a Nestle Affiliate.

Nestle India manufactures internationally famous brand names such as Nescaf Maggi, Milkybar, Kit Kat, Bar-One, Milkmaid and Nestea and in recent years the company has also introduced products of daily consumption and use such as NestlMilk, NestlSlim Milk, NestlDahi and NestlJeera Raita.

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