Nestlé India Confirms Its Status as One of the Key Growth Drivers of the Nestlé Group

Nestlé India has published its results for the first quarter of the 2026/27 financial year, significantly exceeding expectations in terms of growth rates. The company demonstrated not only substantial increases in profit and revenue, but also strong sales volume growth across almost all key categories.

Financial Results

For the quarter:

·         net profit increased by 48% compared with the same period last year and reached 9.59 billion Indian rupees (approximately 111 million US dollars);

·         revenue increased by 25% to 63.78 billion Indian rupees (approximately 736 million US dollars);

·         domestic sales grew by 25%;

·         exports increased by 35.6%.

Following the release of the results, Nestlé India shares rose by almost 2%, reflecting the positive market reaction to the strong performance. 

Growth Is Based on Increasing Sales Volumes

The most important feature of the quarter was that growth was primarily driven by higher sales volumes. For consumer sector companies, this indicator is one of the key measures of business sustainability.

All four major business segments delivered double-digit growth.

The confectionery division continues to strengthen its position, supported by the KitKat brand, which is gaining market share.

The coffee and beverages segment achieved its twentieth consecutive quarter of double-digit growth. This was supported by continued growth in coffee consumption in India, expansion of the premium product range, and strong brand recognition.

The prepared foods, nutrition, and dairy segments also delivered strong results.

India Remains One of the Fastest-Growing Markets

The management paid particular attention to the development of rural regions in the country.

Nestlé continues to actively expand its direct distribution network, increase the number of retail points, and implement digital sales management systems. At the same time, demand remains strong both in large cities and smaller towns.

The expansion of distribution allows Nestlé to increase consumer reach and strengthen its position in one of the largest consumer markets in the world.

The Premium Segment Is Becoming Increasingly Important

Another key growth driver remains the premiumisation strategy.

During the quarter, Nestlé expanded the presence of the Nespresso brand in Delhi, Mumbai, and Bangalore by opening boutiques, pavilions, and temporary retail locations.

Rising incomes in India are gradually increasing demand not only for mass-market products but also for higher-value categories, which positively impacts business margins.

New Business Areas Continue to Grow

The company continues to achieve strong growth in the pet food segment.

Expansion of the product portfolio, wider distribution, and the launch of new products once again delivered double-digit sales growth. At the same time, Nestlé Professional, focused on hotels, restaurants, and cafés, also demonstrated strong volume growth.

This makes the business structure more diversified and reduces dependence on individual product categories.

Investments in Brands Today Are the Foundation of Tomorrow’s Growth

An important feature of the quarter was a significant increase in investments aimed at strengthening brands.

Advertising expenses increased by more than 40%. At the same time, the company continues to implement operational efficiency programs that help offset part of the cost increases.

Increased investment in brands supports current demand while creating the foundation for long-term business growth.

Commodity Risks Remain

Management noted that conditions in commodity markets remain mixed.

Cost pressures may come from high prices for sugar, cocoa, and dairy proteins, while coffee prices may gradually stabilize due to increased production in Brazil and Vietnam.

However, the scale of the business, strong brands, and leading market positions allow Nestlé to successfully adapt to such challenges.

Andrievskii Verdict

For me, this report is further confirmation that Nestlé remains a company capable of combining the stability of a mature global leader with high growth rates in promising markets. The Indian business is no longer simply a regional operation — it is gradually becoming one of the key drivers of the long-term development of the entire group.

Most importantly, the company is growing through higher sales volumes, expansion of distribution, and stronger brands, rather than relying only on price increases. This type of growth, based on real consumer demand, has the greatest value for a long-term investor.

I consider Nestlé one of the best long-term businesses in the global consumer sector. For decades, the company has demonstrated its ability to increase profits, free cash flow, and business value. Markets such as India provide an additional source of growth that can support the development of the entire group for many years.

Nestlé is not a company designed to double capital within a few years. Its value lies elsewhere — it is a business that, through the strength of its brands, global scale, and disciplined management, is capable of steadily increasing intrinsic value for decades. In my view, companies like this should form the foundation of a long-term investment portfolio.

Aleksei Andrievskii | Advisory Board Member, Bendura Bank AG | Liechtenstein