Nestlé, the Swiss food, and beverage (F&B) conglomerate is making significant strides in India’s local manufacturing initiative by establishing a new plant in Odisha. Nestlé India, the local subsidiary of the company headquartered in Vevey, Switzerland, has obtained the necessary approvals from the authorities to proceed with the project.
The establishment of a new plant in Odisha reflects commitment to expanding its manufacturing capabilities in India. This move aligns with the Indian government’s emphasis on promoting domestic manufacturing and attracting investments from global companies. By establishing a presence in Odisha, the company aims to enhance its production capabilities, cater to the growing demand for its products, and contribute to the development of the local economy.
The investment in a new plant in India is a testament to its confidence in the market’s potential and its long-term commitment to serving Indian consumers. It also highlights the company’s recognition of India as a significant market for its food and beverage products, and the importance of local manufacturing to meet consumer demands effectively.
Nestlé, which holds the position of being the largest food and beverage (F&B) company in India, is preparing to establish a manufacturing plant focused on the production of packaged food items. The company has reportedly identified a location in the Khurda district of Odisha, near the state capital of Bhubaneswar, for this new facility, as sources have informed Business Today.
This strategic move by the company aligns with its objective of expanding its manufacturing footprint in India to cater to the growing demand for packaged food products. By selecting a location near Bhubaneswar, the company aims to leverage the region’s infrastructure and logistical advantages for efficient production and distribution. This manufacturing plant in Odisha’s Khurda district will enable Nestlé to enhance its capacity and meet the needs of consumers in the region.
The establishment of a new manufacturing plant by it signifies the company’s commitment to India and its recognition of the country’s potential as a significant market for its products. It further solidifies its position as a key player in the Indian F&B sector, contributing to local employment, economic development, and the availability of packaged food options for consumers.
As per the sources, Nestlé has revealed plans to invest around Rs 900 crore in setting up the packaged foods plant, which is expected to generate employment for nearly 800 people. This facility would mark the 10th manufacturing plant for Nestlé in India, where the company has been operating since 1912. Initially, Nestlé entered the Indian market by importing baby formula products, but it established its first plant in 1961 in Moga, Punjab.
The company’s significant investment in the new plant highlights its commitment to expanding its manufacturing capabilities in India and meeting the demand for packaged food products. The creation of job opportunities is expected to contribute to local employment and boost the economic growth of the region. With a long-standing presence in India, its continued investment underscores its belief in the potential of the Indian market and its dedication to serving Indian consumers.
The new plant in Odisha would further strengthen Nestlé’s manufacturing network in the country and enable the company to better cater to the evolving needs and preferences of Indian consumers.
According to a spokesperson from Nestlé India, the company has applied for the allotment of land in Odisha to establish a manufacturing unit. The spokesperson further mentioned that they have been informed about the approval of the proposal by the State Level Single Window Clearance Authority (SLSWCA). However, as of now, they are yet to receive an official communication regarding the approval.
Nestlé India has been witnessing rapid sales growth in recent years, prompting the company to expand its manufacturing capabilities. In 2020, Nestlé set up its ninth plant in Sanand, Gujarat, with an investment of over Rs 700 crore. This plant was specifically established to increase the local production of their popular product, Maggi instant noodles. These initiatives are part of Nestlé India’s Rs 2,600-crore capital expenditure plan, as announced by its Chairman and Managing Director, Suresh Narayanan, a couple of years ago.
The establishment of new manufacturing plants in strategic locations, including Odisha and Gujarat, showcases Nestlé India’s commitment to expanding its production capacity to meet the growing demand for its products in the Indian market. These investments reflect the company’s long-term vision for growth and its efforts to enhance its manufacturing capabilities in key regions across India.
In a recent interaction with Business Today, Nestlé India’s Chairman and Managing Director, Suresh Narayanan, highlighted the company’s impressive growth in penetration, volume, and innovation. Narayanan emphasized that Nestlé has consistently achieved industry-leading growth rates in these areas. He also pointed out that the company’s portfolio is stronger than ever, with Nestlé holding a leading position in multiple categories where it operates.
Narayanan’s efforts to expand Nestlé’s production capacity are backed by solid reasons. Despite the challenges posed by the COVID-19 pandemic, Nestlé India’s net sales witnessed a compound annual growth rate (CAGR) of 11 percent, amounting to Rs 16,790 crore. Additionally, despite the significant inflation in commodity prices, the company’s net profit showed a CAGR of 6.7 percent, reaching Rs 2,305 crore in CY22. It is noteworthy that Nestlé India follows a January-December financial year.
These financial figures demonstrate Nestlé India’s resilience and ability to navigate through challenging market conditions while maintaining steady growth. The company’s focus on innovation, strong portfolio, and consistent performance have contributed to its success in the Indian market. Narayanan’s commitment to increasing production capacity aligns with the company’s objective of meeting the rising demand for its products and further capitalizing on the growth opportunities in the F&B sector in India.