Food inflation reshaped household consumption in FY26, says Nestle India CMD
Financial year 2026 (FY26) is a challenging year for India’s consumer economy as global headwinds and rising raw material prices reshape consumer behavior, Nestle India said on Friday.
“FY26 has not been a simple year for India’s consumer economy…Food inflation has shaped household choices in ways that go far beyond price,” Manish Tiwary, Chairman and Managing Director, told shareholders at the company’s 67th annual general meeting.
“Families have re-evaluated their package sizes, purchasing frequency and category priorities,” he said, adding that challenges persist even after the company reported a decade of high revenue growth in the fourth quarter of FY26 (4FY26).
“There will be periods that test us. There will be bets that don’t pay off immediately. That’s the nature of building something that lasts,” he said.
Consolidated profits of Nestlé India, known for Kitkat and Maggi, increased by 27% YoY ₹1,110.9 crore in 4QFY26, while revenue from operations increased by 22.6% ₹6,747.79 crore.
The company also announced that it will distribute a special dividend. ₹2 per share with nominal value ₹During the General Assembly 1.
Shares of Nestle India rose on Friday following the news. They were trading up more than 1 percent on the National Stock Exchange. ₹While it was at 1,461.70 apiece, the benchmark Nifty50 increased by 0.40%.
Tiwary said rural demand has improved but depends on monsoon performance and farm incomes, while urban demand remains unequal across income groups.
He said energy costs globally, trade disruptions and geopolitical uncertainty keep input costs variable and require constant monitoring.
Going forward, the company will focus on four pillars of growth: expanding its presence in tier 2 and tier 3 cities, consumer focus, increasing investment in brands and production capacity, and accelerating technology-driven sales and operations.
Nestle has added approximately 520,000 outlets in urban, semi-urban and rural markets since April 2023.
In May, Tiwary said: Mint It noted that rural markets make up about 23-26% of the company’s portfolio, far below the 48-55% seen for many similar consumer goods, leaving significant room for expansion.
Analysts remain optimistic about the company’s future. “We expect strong results to continue and like Nestle’s innovation, premiumization and rural expansion,” analysts at Nuvama Institutional Equities said in a June 16 report. “The easing in coffee and cocoa prices bodes well considering the current inflation in packaging costs,” they added.
