Chairman and Managing Director Manish Tiwary said the top end of India’s consumer market continues to remain resilient despite pressure on urban middle-class spending, as the company maintains annual capital expenditure of more than ₹2,000 crore to expand domestic manufacturing.
The top end of India’s consumer market continues to remain resilient despite pressure on urban middle-class spending, Nestlé India Chairman and Managing Director Manish Tiwary said on Tuesday, while acknowledging its ongoing ₹2,000 crore capex to expand domestic manufacturing capacity.
Speaking at the Citi India Conference 2026, Tiwary described India as an increasingly “three-speed” consumption market, where affluent consumers continue to spend aggressively, rural demand remains structurally healthy, and middle-income urban households are turning more cautious amid inflationary pressures.
“In my opinion, the consumer growth story is as intact and as solid as it has ever been,” Tiwary said. “The top end is very resilient and I see that continuing to grow. The challenge is more in the urban middle.”
Tiwary said the top 30–40 million consumers in India continue to show strong spending appetite across sectors such as automobiles, housing and premium consumption, while rural India has continued to outpace urban markets over the past three years.
The pressure point, according to him, remains middle-income urban consumers whose real income growth has lagged inflation, prompting a “wait-and-watch” approach towards discretionary purchases.
Nestlé India Chairman and Managing Director Manish Tiwary
“Real earnings growth has not kept pace. That’s where we see a little wait-and-watch, where consumers could push off discretionary expenditure,” he said.
Nestlé deepens India’s manufacturing bets
Despite the uneven demand environment, Nestlé India is continuing to deepen investments in local manufacturing and supply chains, including setting up its tenth factory in Odisha, signalling the company sees the current slowdown as cyclical rather than structural.
“If you look at the last two years, capex was upwards of ₹2,000 crore each year, and we’ll continue to invest,” Tiwary said. “We do 98% of our manufacturing in India, which is why we need to keep investing.”
“We are putting our money where our beliefs are
Tiwary also acknowledged that a growing share of India’s consumption growth is increasingly being captured by unlisted, regional and digital-native brands, a trend that is reshaping competition in the FMCG sector and fragmenting categories once dominated by large companies.
“The share that large companies have conceded is real,” he said, referring to the sharp rise in smaller and insurgent brands across categories such as personal care.
He cited the sunscreen market as an example of how dramatically consumer markets have fragmented over the past decade.
“Ten years ago there were probably five brands of sunscreen lotion in this country; today there are 200,” he said.
Tiwary said the shift also explains why India’s broader GDP growth has increasingly diverged from the earnings growth reported by many listed consumer companies.
“Much of that GDP growth is being captured by unlisted, regional, and insurgent brands,” he said.
Consumer voice and AI
Asked how companies build resilience through cycles of commodity shocks and geopolitical disruptions, Tiwary said companies need to stay anchored to consumer feedback while building agile supply chains and technology-led operating models.
“Especially during a crisis, if you really want to be resilient, the voice of your consumer has to be much larger,” he said.
Drawing on his decade-long experience at Amazon before returning to FMCG, Tiwary said Nestlé sees artificial intelligence primarily as a productivity and workflow optimisation tool rather than a replacement for jobs.
“My aspiration is to move from 40–50% busy work and 50% impact work to 90% impact work,” he said, referring to automation of reporting, analytics and operational workflows.
“Technology can break the busy work very, very easily across the entire end-to-end cycle. That’s how I see AI — as the one lever that can give nonlinear growth,” he said.
On concerns around jobs, Tiwary said expanding manufacturing capacity would itself generate employment across construction and factory operations.
“The growth we are seeing will, in a small way, create more jobs — but it’s more about making people more productive and letting machines do the heavy lifting,” he said.