Nestle India Q2 Results: Profit Falls 23%; Margins Contract

Nestle India Ltd. reported a double-digit decline in profit for the September quarter of the financial year ending March 2026.

Standalone net profit for the quarter ending September fell 23.7% to Rs 752 crore from Rs 986 crore a year earlier, according to its notification to the exchanges on Thursday.

Meanwhile, revenue rose 10% year-on-year to Rs 5,644 crore, comfortably beating Bloomberg’s estimate of Rs 5,350 crore.

Margin saw a 120 basis point contraction and stood at 21.9% compared to 23.1% during the same period last year.

• Revenue up 10.5% at Rs 5,643 crore versus Rs 5,104 crore (Bloomberg estimate: Rs 5,350 crore)

• Net profit down 23.7% at Rs 753 crore versus Rs 986 crore (Bloomberg estimate: Rs 762 crore)

• Ebitda up 6% at Rs 1,237 crore versus Rs 1,168 crore (Bloomberg estimate: Rs 1,191 crore)

• Margin at 21.9% versus 22.9% (Bloomberg estimate: 23.4%)

Operationally, Nestle saw three of its four product groups posting strong volumes, which eventually led to double-digit income growth.

Domestic sales, in particular, showcased robust performance, reaching Rs 5,411 crore, the highest ever recorded in any quarter.

The confectionery product, Powdered and Liquid Beverages, Prepared Dishes and Cooking Aids groups grew at a strong double-digit rate, driven by significant underlying volume growth.

Going forward, Nestle India milk prices are expected to soften after the festive season, coinciding with the onset of the flush season.

Coffee prices are anticipated to stabilise and may decrease as the upcoming crops in Vietnam and India appear to be normal.

The global supply and demand for cocoa are projected to balance, primarily due to a correction in demand over the past two years while edible oil prices are expected to remain firm and may rise further due to a tight supply and demand at the global level.

Nestle India also acknowledged the recent GST cuts as a positive development for the company.

"The recent amendments in the Goods and Services Tax (GST) rates announced by the Government of India is a positive step for consumers. It is expected to stimulate consumption, drive affordability and contribute to the overall growth of the FMCG sector and the economy. We have been working closely with our partners, distributors, wholesalers, and retailers, to pass on the benefits of the revised GST rates across our product groups to our consumers," the company said.