Nestlé India is strengthening its focus on rural and semi-urban markets as it looks to build long-term growth, with Chairman and Managing Director Manish Tiwary highlighting rising consumer aspirations and increasing consumption beyond metro cities.
Speaking at the company's 67th Annual General Meeting (AGM), Tiwary said India offers significant growth opportunities, driven by wider household penetration, expanded distribution, and stronger engagement with consumers across different regions. He emphasised that understanding India's diverse consumer base remains central to the company's strategy.
"India is not one market, and it is certainly not one consumer. It is dozens of markets layered on top of each other by income, geography, language, aspirations, habit, and taste. The opportunity ahead of us is not just to serve the India that already knows us well."
Reflecting on the previous financial year, Tiwary said FY26 presented challenges for India's consumer economy as food inflation continued to influence purchasing behaviour.
"FY26 was not a straightforward year for India's consumption economy. Food inflation shaped household choices in ways that went far beyond price."
He said consumers adjusted pack sizes, purchase frequency, and product preferences during the year. While rural demand improved, it remained dependent on monsoon conditions and farm incomes. Urban demand stayed resilient but varied across income segments. He also pointed to rising energy costs, freight disruptions, and geopolitical uncertainties as factors affecting input costs. Despite these challenges, Tiwary said the company maintained its focus and achieved record domestic sales.
"Last year, more Indian households chose Nestle than ever before."
Nestlé India recorded its highest-ever domestic sales of Rs 23,071.5 crore, supported by double-digit volume-led growth and gains in market share. According to Tiwary, the company's long-term strategy is centred on increasing household penetration and encouraging higher purchase frequency.
"A sustainable growth in a country as large and dynamic as India must come from reaching more households and the frequency with which consumers choose our brands."
He added that rural India will play an important role in the company's future growth.
"This is especially true in rural markets where aspirations are rising and where the next wave of long-term consumption is being shaped."
Since April 2023, Nestlé India has added around 5.2 lakh retail outlets across urban, semi-urban, and rural markets to improve access to its products. The company is also increasing investments in Tier II and Tier III cities, technology, and manufacturing capacity.
"Over the next several years, we are making deliberate, thought-through bets. First, on expanding our presence in Tier ll and Tier lll towns where consumption is rising faster than in metros."
Tiwary said Nestlé India has committed around Rs 2,000 crore in capital expenditure over the last two years, including investments in its confectionery and food businesses as well as a greenfield manufacturing facility in Odisha.
Responding to shareholders, he said the company's long-term strategy is built around four key priorities: consumer centricity, penetration and volume growth, sustained investment behind brands, and accelerated adoption of technology. Tiwary also identified exports as an important growth opportunity, saying the company is "very, very focused" on expanding its international business from India.
He added that Nestlé India sees strong potential in the growing pet care market, where it offers products for both cats and dogs. The company is also exploring opportunities in the chocolate category, noting that India has become the world's largest market for KitKat. Commenting on taxation, Tiwary welcomed the reduction in GST rates across several categories before Diwali last year, saying it helped improve consumer sentiment and consumption.
On distribution, Tiwary said Nestlé India continues to work with partners across general trade, organised retail and quick commerce channels to improve product availability. He added that the company is investing in capacity expansion and new technologies, including its upcoming manufacturing facility in Odisha.
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