'Premium pitch key growth pillar for Nestle India'

NEW DELHI: India is one of the fastest-growing markets for Swiss packaged foods giant Nestle globally, driven by the country's large consumption base, strong performance of core brands, and entry into new, high-potential premium categories, according to Suresh Narayanan, the outgoing chairman & managing director of Nestle India.With a turnover of over Rs 20,000 crore and a revenue CAGR of just over 10% during the past decade, Nestle India is well-positioned to sustain its growth momentum, he said.Its strategy - anchored in premiumisation, faster-paced innovation, and a sharper focus on 'Rurban' markets through a consumer cluster-based approach - is expected to accelerate growth for the packaged foods company in a market which has been facing stubborn commodity inflation and a consumption slowdown, said Narayanan."Premiumisation and innovation are the two key pillars of growth. Along with a focus on legacy brands like Maggi and KitKat, the company aims to deliver sustained growth. Since the Maggi crisis in 2015, Nestle recalibrated and rejuvenated its portfolio by launching over 150 new products, which now contribute 7% to sales. Innovation is now four times faster than it was a decade ago," he told TOI in an interview.Premium products contribute around 12% of Nestle India's sales, up from 10% in 2018, growing at a 16% CAGR since 2015.

With a Rs 7,500 crore market opportunity, premiumisation is a key driver of growth and profitability.Nestle India's capital expenditure has risen from nearly 2% of sales in 2015 to 10% of sales in FY 2024-25 - a clear reflection of the company's growing confidence in the Indian market and its deepening focus on serving evolving consumer needs.Additionally, through a consumer cluster-based and 'Rurban' strategy introduced in 2019, the company strengthened its route-to-market, with its brands now reaching two out of three households, said Narayanan, adding this strategic agility, combined with deep consumer insights, positions Nestle well to capitalise on evolving market trends and shifting preferences.Responding to a question on the company's strategy of steering clear of mergers and acquisitions, he said, "We continue to explore good opportunities. But again, the question is one of valuation, potential, synergies, and growth opportunities that we see." India ranks among the top 10 global markets for the Switzerland-based Nestle and is the leading market worldwide for its flagship food brand Maggi, as well as the second-largest market for its confectionery brand KitKat.