Nestle India LTD.

NESTLE INDIA LTD.

HENRY O NESTLE• Founded in 1867• Had an Objective in mind: To Be the Largest and Best

Brand Food Manufacturer Eight of the thirty selling

products should include Nestle Logo

Not only make well selling products but be the best in food market

Henry O Nestle

History

• Farine Lactee Nestle - 1st product• Substitute for Mother's Milk• Other products: Carbonated Mineral water Nuts Oil, Rum and Vinegar World’s First Instant Coffee in 1938

• In 1960 -- Switzerland’s Biggest company with 200 Factories

Entry in India

• In 1905,Nestle acquired the Anglo-Swiss Condensed Milk Company.

• Nestlé's relationship with India started in 1912• 1947-local production• 1961- Moga, Punjab

Company Profile

• is a Swiss multinational food and beverage company headquartered in Vevey.

• largest food company in the world measured by re

• grew significantly during the First World War venues.

• Nestlé has a primary listing on the SIX Swizz Exchange and is a constituent of the Swiss Market Index

• In 2011 - Nestlé was listed No. 1 in the Fortune Global 500

• In 2013 - Nestlé ranked No. 9 in the FT Global 500

Nestlé's CEO

• Born-1954• Nestle 20 September 2007 OBJECTIVES• Creating Shared Value• Focusing on Nutrition• Water, Rural Development

and More• Meeting our Commitments• Sharing your views

Paul Bulcke

NESTLE BRANDS

Marketing StrategiesBeverages

Nescafe Coffee

• First instant coffee(1938)• NO demand• Aim - Mass Marketing

• After 10years need for innovation………

Marketing StrategiesBeverages

• Introduced in 1952• Nondairy creamersWhat r these??

• Substitute for milk

Marketing StrategiesBeverages (new innovations)

Nespresso (1976) The Nescafe(2006)

Marketing StrategiesMilkshakes and other beverages

• Company had introduced Milo in 1996 as energy drink

• Competitors were Bournvita and Boost

• Advertisement problem ………………..• Thus a dead product in

India

Marketing StrategiesChocolate

• Began as chocolate in 1948(U.S.A) as►

• Launched in 1950 in Europe

• name was changed to the worldwide brand Nesquik in 1997

• In 1999-Nesquik Cereal

Marketing Strategies Chocolates

Galak

KitKat

Marketing StrategiesMilk and Nutrition(Icecreams)

Marketing StrategiesMilk and Nutrition(Sweeteners)

• Milkmaid and Caramel• Condensed milk• For tea and coffee• Sweets• Change in cover Back cover-recipes Front cover-sweets Faltering demand

Marketing Strategies Milk and Nutrition(Cereals)

• Aimed at mothers and children

• Animation

Marketing Strategies “Taste Bhi Health Bhi”

• Prepared dishes• NO demand• Failed terribly• Change-----

• FREE SAMPLES Masala Atta Noodles

Marketing Strategies “Taste Bhi Health Bhi”

Marketing Strategies “Taste Bhi Health Bhi”

Marketing Strategies “Its different”

Marketing Strategies Water

• Yet 64 brands such as Nestlé Pure Life, Poland Spring, AcquaPanna, S.Pellegrino, Perrier, Vittel,

Buxton.• Yet to cover Indian Markets due to other competitors.

Nestle mineral waters formed by 1845 by Henri Nestle.

Promotion Strategy(Nestle Pure Life – NPL)

Promotion important and crucial elementthe company establishes its image in the mind of the customers.Slogan is Pure Life is “fresh and rejuvenating taste”“Embrace the pure life”.

PRISING STRATEGY• Jan2011-Sept2011Domestic market: Sales rose 9.5% year-on-year while value rose 21.5%.Exports market. Sales declined 10.2% year-on-year, but it rose 8.9% in value

terms.Conclusion Nestle has been hiking prices sharply, a strategy that runs

the risk of hurting consumer demand and even becoming uncompetitive.

Net Sales (in Crores)

2008 2009 2010 2011 20120

1000

2000

3000

4000

5000

6000

7000

8000

9000

Net Sales (in Crores)

Net Sales (in Crores)5129.4

6254.7

7490.8

8302

4324.24

Net Sales (Increase in % )

2008 2009 2010 2011 20120

5

10

15

20

25 23.421.9

19.8

10.8

Net Sales (increase in % )

Net Sales (increase in % )

18.6

Net Sales (in Crores )

2008 2009 2010 2011 20120

200

400

600

800

1000

1200

Net Profit (in Crores)

Net Profit (in Crores)655

818.7

961.81068

534.08

Net Profit (increase in %)

2008 2009 2010 2011 20120

5

10

15

20

25

30

35

29.1

22.624.99

17.48

11.04

Net Profit (increase in % )

Domestic Sales

2008 2009 2010 2011 20120

1000

2000

3000

4000

5000

6000

7000

8000

9000

Domestic Sales (in Crores )

Domestic Sales (in Crores )3985.85

4800.8

5901

7095

7877

Export Sales

2008 2009 2010 2011 20120

50

100

150

200

250

300

350

400

338.39 328.6353.54

0

380.42

Export Sales (in Crores)

Contribution of Product Categories.

27%

26%18%

12%

11%

6%

2%

Sales (in %)

DrinksDairy & Food ProductsPrepared dishes & Cooked DishesChocolatesPet ProductsPharmaceuticalsBaby Milk Products

Sales by Geographic Area.

Europe America US Asia Rest of the world

0

5

10

15

20

25

30

35

Sales by Geographic Area (in %)

Sales by Geographic Area (in %)

Share Price of Nestle India Ltd.

2008 2009 2010 2011 20120

1000

2000

3000

4000

5000

6000

Share Price as on 31st December

Share Price2445.67

3686.99

4103.60

4960.1019 September 203-

19th September 2013. -5

1362.72

Earning Per Shares

2008 2009 2010 2011 20120

20

40

60

80

100

120

EPS in %

EPS in %55.3967.94

84.91

99.73 110.76

Dividend Per shares

2008 2009 2010 2011 20123940414243444546474849

DPS in %

DPS in %42.5

48.5 48.5 48.5 48.5

Interim Dividend

2008 2009 2010 2011 201211.7

11.8

11.9

12

12.1

12.2

12.3

12.4

12.5

12.6

Interim Dividend

Interim Dividend

12

12.5 12.5 12.5

Nestle India Income and Expenses

2008 2009 2010 2011 20120

1000

2000

3000

4000

5000

6000

7000

8000

9000

4361.56

5169.53

6296.67

7537.02

8357.58

3491.74126.52

5013.52

5952.866501.21

Income Expenses

Earning Before Tax and Profit After Tax Details

2008 2009 2010 2011 20120

200

400

600

800

1000

1200

1400

1600

1800

2000

869.86

1043.02

1283.14

1584.16

1856.37

777.5

931.75

1155.39

1430.83

1579.22

775.86

930.35

1154.32

1421.77

1552.62

534.08

655

818.66

961.551067.93

EBITDA EBIT EBT PAT

Secured Loan and Unsecured Loan(in Crores)

2008 2009 2010 2011 20120

100

200

300

400

500

600

700

800

900

1000

1100

Secured LoanUnsecured loan

0.820.84 0.24

970.031049.95

Fixed Assets & Current Assets (in Crores)

2008 2009 2010 2011 20120

50010001500200025003000350040004500

Nestle India Assets

Fixed Assets Current Assets

1404.851640.79

1854.702552.21

4368.68

422.89597.82 656.91

883.93 1064.61

Operating Profit Per shares

2008 2009 2010 2011 20120

20406080

100120140160180200

86.81

105.31

129.3

159.51

189.32

Operting Profit Per Share

Operting Profit Per Share

Current Ratio and Quick Ratio

2008 2009 2010 2011 20120

0.1

0.2

0.3

0.4

0.5

0.6

0.7 0.660.6 0.62 0.6

0.54

0.280.23 0.26 0.24 0.21

Current Ratio Quick Ratio

CR = CA CL

QR = QA QL

Ratio (in %)

Fixed Asset Turnover ratio

2008 2009 2010 2011 20120

1

2

3

4

5

6

7

8

9

3.2 3.24

8.71

4.83

3.27

Fixed Asset Turnover Ratio

Ratio (in %)

Owners Fund Ratio

2008 2009 2010 2011 20120

20

40

60

80

100

120

99.82 100100

56.7563.13

Owners fund as % of total source

Owners fund as % of total source

Nestle India Investments

2008 2009 2010 2011 20120

50

100

150

200

250

300

350

400Investments (in Crores)

Investments (in Crores)

34.90

203.26

150.68 134.37

364.86

Future Investment

•Nestle plans Rs 500-cr plant in Gujarat for Maggi Noodles.

INVESTMENT IN MILK PLANT

• Antonio Helio Waszyk, Chairman & Managing Director, Nestle India Ltd , said the company had made investment of Rs 9,500 crore in the country, according to an official statement.

• said the company had made investment of Rs 9,500 crore in the country, according to an official statement.

INVESTMENT IN OTHER PRODUCTS

•RS 200cr in chocolates.

•RS 600cr in Green fieldFacility programme.

•$50M in R&D unit inKarnataka.

Final Conclusion

• Nestle India owns very strong brands.• Earnings as much as 25-30 times increases

every year.• Increase in P/E ratio.• Example-For example if you bought Nestle in

2009 at Rs. 1,989 and sold in 2012 at Rs. 4,540 you earned a 32% compounded annual growth rate on your investment in three years.