Nestle's India unit reports profit jump on price hikes, urban demand

CHENNAI (Reuters) -Nestle India reported a near 66% increase in quarterly profit on Thursday, benefiting from price increases and strong demand for its chocolates and packaged foods in urban areas.

The Maggi noodles maker's profit rose to 6.28 billion rupees ($75.98 million) for the fourth quarter ended Dec. 31, from 3.79 billion rupees in the year-ago period.

Sales of chocolates and biscuits in India have defied recent inflationary pressures, analysts have said, as Nestle's KitKat chocolates and rival Britannia Ltd's Little Hearts biscuits are seen as affordable treats.

For Nestle, revenue from operations climbed to 42.57 billion rupees for the reported quarter, from 37.48 billion rupees, a year earlier, on price increases and higher sales volume, it said.

"We delivered our highest double‐digit growth in a decade led by sustained volume growth," Managing Director Suresh Narayanan said in a statement.

The Nescafe coffee maker also said its efforts to expand distribution in smaller towns and cities helped it drive topline growth there, especially in rural villages.

The company also said its board had recommended a final dividend for 75 rupees per share for 2022. Shares of the company were up nearly 2% on Thursday.

Nestle India's parent, however, separately reported weaker than expected full-year net profit despite price increases.

($1 = 82.6550 Indian rupees)

(Reporting by Praveen Paramasivam in Chennai; Editing by Nivedita Bhattacharjee)