 Mumbai:
Even as it has exited from the water business, Nestle
India has seen a robust double-digit growth in the culinary
and milk segment.
The
company remains one of the very few fast-moving consumer
goods (FMCG) companies with a robust growth in revenue
and net profits. Among the new bets, Nestle has failed
to deliver in the water segment (Pure Life) in India,
where globally it is a frontrunner. The company recently
announced that it is exiting from the water business.
Excessive
provisioning by the company is depressing profitability,
say analysts. Overall provisions for the past six years
stand at Rs 1.6 billion, with the company having utilised
/ reversed only 10 per cent of the stated amount.
It
is expected that given the parent''s intention of making
Nestle a 100-per cent subsidiary, excessive provisions
are likely to continue. The analysts are sceptical of
such provisions. It is understood that there is unlikely
to be any write-back of these provisions in the near term.
Nestle
posted a net profit of Rs 2,015.20 million for the year
ended 31 December 2002 (FY-02) as compared to a net profit
of Rs 1,731.50 million in the previous year ended 31 December
2001 (FY-01). The total income increased from Rs 19,372.30
million in FY-01 to Rs 20,755.80 million in FY-02.
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