Nestlé’s Indian arm has invested Rs7.06bn ($83.9m) in its joint venture with pharma group Dr Reddy’s in India.
Nestlé India will continue to hold a 49% shareholding in the venture, which was announced in April, with Hyderbad-based Dr Reddy’s holding the remainder, according to a stock-exchange filing.
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Meanwhile, Dr Reddy’s Laboratories said that it has made an investment of Rs7.34bn in the venture.
The two companies plan to target categories the statement listed as “metabolic, hospital nutrition, healthy aging, general wellness, women’s health and child nutrition”, they revealed earlier this year.
Nestlé India also added that it has executed a business transfer agreement for the slump sale of its existing medical nutrition and nutraceuticals business to the joint venture company, at a lumpsum consideration of Rs2.19bn.
The companies plan to work together in India and “other agreed territories”, the stock-exchange announcement added in April.
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By GlobalDataThe venture was up and running in the second quarter of Nestlé India’s 2024/2025 financial year, which started on 1 April.
For the quarter ended 30 June, Nestlé India profit rose 7% year-on-year to Rs7.47bn compared to Rs6.98bn in the first quarter of FY24, while revenue rose 3.3% to Rs48.14bn.
Suresh Narayanan, chairman and managing director of Nestlé India, said: “I am pleased to share that despite external challenges such as lower consumption growth, concerns on continued food inflation and volatile commodity prices, we have delivered growth across our product groups.”
He added: “Prepared dishes and cooking aids too maintained its growth momentum, with innovations contributing to circa 30% of the growth in the quarter. Maggi Korean Noodles has been well received by our consumers and Masala-Ae-Magic saw double digit growth. KitKat delivered double-digit growth.”
Earlier this year, India’s consumer court cleared Nestlé, the world’s largest food group, of government allegations of “unfair trade practices” related to the lead contamination scare that rocked the Maggi brand in 2015.
