Food and nutrition major Nestle India plans to focus on core categories, including milk & nutrition, chocolates & confectionery and coffee & beverages to explore growth and expansion opportunities in these segments, a top company official said.
The company believes that during this time and in the post COVID-19 world, consumers would seek trust, quality, intervention of science and technology, better nutrition and better immunity for the family, Nestle India Chairman and MD Suresh Narayanan said at the company’s annual general meeting last month.
“These are all areas where the company has core competence and strength and will continue to work on the product offerings catering to such needs,” he said.
Narayanan said the company is “looking at with a greater degree of confidence, both in the prepared dishes and cooking aids category and chocolates and confectionery category. The company expects to do well in the coffee products and finding growth opportunities”.
“The company will focus on the core categories it operates in which is ‘milks and nutrition’, ‘prepared dishes and cooking aids’, ‘chocolates and confectionery’, and of course, ‘coffee and beverages’,” Narayanan said.
In addition, the company has made a foray into new products like breakfast cereals business under the brand name NESPLUS, Nestlé Health Science business, which are witnessing satisfactory performance, he said.
“There are opportunities that the company sees, whether it is in immunity products, better nutrition products, more convenient products, more efficacious products, products addressing specific health needs and health requirements.
“The company has strong support and access to all possible technology and assistance from Nestlé Group,” he said.
On the company’s production capacity and continuous supply of products, Narayanan said all eight factories of the company are operational with an average of about 80 per cent of the manufacturing capacity.
With regard to price hike of products, Nestle Chairman clarified that no price increase was taken up during the COVID-19 period and that hikes are not made opportunistically but considering factors like commodity headwind that is not capable of being mitigated by the company either by better efficiency, better economies of scale or by better and more efficacious manufacturing.
“Only in such situations conscious decision on price increases are taken. As of now, the company has no plan to increase the prices,” he added.
Talking about capacity expansion of the factories and capital expenditure plans, Narayanan said, the company continues to evaluate the creation or addition of capacities at the existing or new facilities, based on the demand and growth in various categories.
“The company has plans to put up its ninth factory in Sanand in Gujarat with an investment of over Rs 700 crore. Unfortunately, the civil construction work has been impeded due to labour shortage in the wake of COVID-19,” he said.