In the next three-and-a-half years by 2025, global food and beverage conglomerate Nestle SA strategizes to capitalise on Rs. 5,000 crore in India, said its CEO, Mark Schneider.
The move will help the company to fast-track its core business in the country and bring new opportunities for growth. The investment would be in capex (capital expenditure), setting up new plants, acquisitions, and expansion of the product portfolio of the company.
Nestle has nine plants across India currently and is also looking at new locations to set up manufacturing capacity. The investment, which is subject to clearances and approvals, will also contribute to the creation of more jobs in the domestic market.
According to Schneider, for the Indian market, which is among Nestlé’s top ten markets, the company has an investment plan of Rs. 5,000 crore through 2025. “When you look into the investment in this country and the investment plan through 2025, we are talking about Rs. 5,000 crore, and that compares to Rs. 8,000 crore over the last 60 years when we started manufacturing in this country,” he said.
Schneider further said Nestle India’s business has maintained “consistency at very high levels” for 22 quarters, which is “outstanding” and “truly stunning” and shows a complete willingness for “open chequebook” support every step of the way.
Nestle has been in India for over 110 years but started its manufacturing activity in the early 1960s, he added. “In 1961, we started our first manufacturing site and so in that whole time period it has been Rs. 8,000 crore and now in the next three years, it will be Rs 5,000 crore,” he said.
This investment is not only for accelerating and ramping up capex alone but also goes into a whole lot of development work, brand building, and meaningful contributions on the ground, Schneider said.
Nestle India Chairman and Managing Director Suresh Narayanan said that accelerating the core business of the company would be a focus area. “It is definitely a highly accelerated plan that we are looking at. This has three pivots, such as continuing the strong momentum of growth that the company has had in the last 22 quarters, “he said.
The second part is to do it sustainably, and Nestle has taken “significant steps” in that direction. “And the third part is really to leverage new opportunities for growth, whether it is plant-based proteins, healthy ageing, healthy snacking, leveraging some of the Indian grains into products for the company,” Narayanan said.
The investment would be in organic growth such as capex and putting money into facilities such as existing factories or research centres. And on top of that, there are interesting opportunities for M&A that Nestle will be very happy to explore.
Nestle India presently operates nine factories employing roughly 6,000 people. “The ambition to invest Rs. 5,000 crore would have been a significant increase in direct and indirect employment as well,” he said. Nestle India’s revenue in 2021 stood at Rs. 14,709.41 crore. It had recently invested approximately Rs. 700 crore to open a plant in Sanand, Gujarat, to manufacture a variety of popular instant noodles, Maggi.