Nestle India Q3 Results: Net profit jumps 37% to Rs 908 crore, beats Street estimates; board announces 1:10 share split

Nestle India on October 19 reported a strong set of Q3 results and announced a share split plan in the ratio of 1:10. The announcements sent the Nestle India shares leaping into the green.

Nestle India reported a strong set of Q3 earnings on October 19. | Source: Reuters

Nestle India on Thursday reported a strong set of financial results for the July-September period, and its board approved a proposal to split the stock of the consumer products company in the ratio of 1:10. The board of Nestle India—whose popular brands include Maggi, Nescafe, KitKat and Nestea—also declared an interim dividend.

Nestle India shares leaped into the green after the announcements, finishing the day stronger by Rs 852.4, or 3.7 per cent, at Rs 24,122 apiece on BSE after hitting a record high of Rs 24,228.8 during the session.

Nestle India Q3 results

The consumer products company reported a 37.3 per cent year-on-year jump in net profit to Rs 908.1 crore for the quarter ended September 30, driven by a rise in demand.

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It registered 9.4 per cent growth in total product sales to Rs 5,009.5 crore for the September quarter, crossing the Rs 5,000 crore mark for the first time ever, boosted by 10.3 per cent growth in domestic sales. Its revenue increased 9.5 per cent to Rs 5,036.8 crore.

According to Zee Business research, the company was estimated to report a quarterly net profit of Rs 768 crore and revenue of Rs 5,028 crore for the quarter under review.

“I am pleased to share that we have, yet again, delivered consistent performance almost across all major brands. Domestic sales grew in double digits, on account of mix, volume and price. Key brands continued to perform well, led by KitKat, Nescafe Classic, Nescafe Sunrise, supported by Munch and Milkmaid," said Suresh Narayanan, Chairman and Managing Director, Nestle India.

"We are investing towards building our brand equity and have made strong and significant investments across all product groups. We crossed INR 5,000 crore turnover, which has been our first in any quarter in the history of the Company and a landmark for us," he said.

The company's quarterly margin—a key measure of profitability—improved by 220 basis points on a year-on-year basis to 24.3 per cent, exceeding the analysts' estimate of 22 per cent.

Nestle India said that the expected impact of uneven rain and rain deficit on the production of maize, sugar, oilseeds and spices may have an adverse impact on pricing. "Coffee continues to be volatile because of global supply deficit. The weather during the harvest of Indian Robusta crop may impact production. Upcoming winter weather may impact wheat production. Healthy milk flush is expected in winter which is expected to keep prices stable," it added.

Nestle India dividend

The Nestle India board declared November 1 as the record date for the dividend of Rs 140 per share—a 1,400 per cent payout given the face value of Rs 10 per share.

The company said the dividend, amounting to Rs 1,349.8 crore, would be paid on and from November 16. Read more on Nestle India dividend

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