Food inflation reshaped household choices in ways that went far beyond prices as families reconsidered pack sizes, purchase frequencies and category priorities in FY26, Nestle India, Chairman & Managing Director, Manish Tiwary told shareholders at the company’s 67th Annual General Meeting.
He added that the FMCG major is making key strategic bets on accelerating penetration in rural and semi-urban regions and strengthening its omni-channel presence.
Stating that FY26 was not a “straightforward” year for India’s consumption economy, Tiwary added that, “rural demand improved but remained dependent on monsoon outcomes and farm incomes, urban demand held up, though unevenly, across income segments.” At the same time, global energy costs, freight disruptions, and geopolitical uncertainty continued to move input costs. He said Nestle India responded to these challenges with discipline and focus and more Indian households chose the company’s products than ever before.
“India remains a market of immense opportunity, where consumption growth will increasingly be driven by deeper household penetration, wider distribution and stronger engagement with consumers across geographies, “ he added. With a focus on penetration-led volume growth, the FMCG major has added 5.2 lakh retail outlets since April 2023 as part of its strategy to expand and deepen its distribution.
“Over the next several years, we are making deliberate, thought-through bets, on expanding our presence in tier-2 and tier-3 towns, where consumption is rising faster than in metros, on building a portfolio that serves consumers at multiple price points, premiumising and also ensuring that quality Nestle products are accessible to more households,” Tiwary said.
Nestle India has committed ₹2,000 crore in capex over the last two years which includes expanding capacity in confectionery and food business and a greenfield facility in Odisha.
Rural penetration
Responding to a shareholder query, he said the company is accelerating rural penetration by scaling its distribution footprint through targeted technology-led interventions.
“We will continue to strengthen our omni-channel approach, ensuring that our brands are available across the location and channels most convenient to our consumers. Our salience continues to grow in urban markets and larger towns, supported by sharper availability and strategic partnership with key e-commerce platforms and quick commerce at the same time,” he noted.