India Becomes Nestle Maggi's Top Market Globally With 6 Billion Servings

India is now the largest market globally for Nestle India Ltd.'s popular instant noodles and soup brand Maggi, and the second largest market for its chocolate wafer brand KitKat. Additionally, India has emerged as one of Nestle's fastest-growing markets, experiencing high double-digit growth.

The company attributed the success to penetration, premiumisation and innovation, combined with disciplined resource allocation, in its annual report for fiscal 2023–24.

Nestle's India unit sold over six billion servings of Maggi in the last fiscal, "making India the largest Nestlé market for Maggi worldwide," the report said. The FMCG giant is expanding its play under the brand Maggi and has launched Oats Noodles, Korean Noodles and various masala variants at an affordable price of Rs 10.

"The prepared dishes and cooking aids business recorded a strong growth momentum. This was aided by a balance of product mix, pricing and volume growth in Maggi noodles and Maggi Masala-ae-Magic, supported by strong consumer engagement and market presence with media campaigns and attractive consumer activations," it said.

In confectionary, Nestle India said it sold 4,200 million fingers of KitKat. The growth was fuelled by the launch of new products, the expansion of the distribution network and innovative brand activations. "KitKat has emerged as the star performer by not only delivering strong growth but also making Nestlé India the second largest market for the brand globally," it said.

In India, the Maggi brand made a comeback following a five-month prohibition on its instant noodles due to accusations of exceeding the allowed levels of lead. The noodles were reintroduced to the market in November 2015 after a relaunch, and Nestle India subsequently expanded the brand into the food sector and related areas.

Prior to the crisis, the brand held a market share of more than 70% in the instant noodles sector, a level it has yet to regain due to heightened competition from new entrants in the market.

Nestle, which is setting up its tenth Indian factory in Odisha, reaffirmed the significance of India as a market.

"Strengthening this further, your company is poised to invest approximately Rs 7,500 crore between 2020 and 2025 to develop new capabilities and expand existing ones with a sharp focus on sustained growth and innovation," its Chairman and Managing Director Suresh Narayanan said while addressing shareholders in the report.

The company is focusing on innovations, and in the past eight years, it has launched over 140 products. A significant portion of sales in 2023 was attributed to innovative products.

According to Narayanan, plant-based products present a significant opportunity for Nestle India, which has been operating here for 112 years. It is also expanding its presence, and through the RUrban Journey, its direct coverage has gone beyond two lakh villages.

Nestle India recently announced it would continue to pay royalty to its parent company at the existing rate of 4.5% of net sales after a proposal to hike it was rejected by shareholders. The company mentioned in its yearly report that the royalty fees paid to the licensor by the company are relatively lower compared to other multinational corporations operating in India.

Nestle India reported sales of Rs 24,275.5 crore in the 15 months to March 31, 2024.

(With PTI inputs)