Nestlé India Limited (500790) Earnings Call Transcript & Summary

Dear members of Nestle parivar, good afternoon, and welcome to the Extraordinary General Meeting of Nestle India Limited through videoconferencing or other audiovisual facility. [Operator Instructions] Please note, as per the requirements, the proceedings of the EGM will be recorded and will be available on the company's website later. Without any delay, I hand it over to Mr. Suresh Narayanan, Chairman and Managing Director.

Thank you, Inba. I must say dear members, it gives me immense pleasure to extend a warm welcome to each one of you from India and overseas who are attending the extraordinary general meeting of Nestlé India. I would like to inform you that both of the directors, Company Secretary and other company officials including myself, are participating from our office in Gurugram. I would now like to take a moment to introduce the Board members and key managerial personnel who are present on the screen. Mr. PR Ramesh, Lead Independent Director, Chairman of the Audit Committee and member of the NRC and Risk Management and Sustainability Initiatives Committee. He is participating from Mumbai; Ms. Anjali Bansal, Independent Director, Chairperson of the NRC and member of the CSR Committee, Audit Committee and Risk Management and Sustainability Initiatives Committee; Ms. Alpana Parida, Independent Director, Chairperson of the SRC and member of the Audit Committee and the NRC; Ms. Svetlana Bodlina, Executive Director of Finance and Control, and CFO, member of the CSR Committee and SRC; Mr. Satish Srinivasan, Executive Director, Technical; and permanent invitee to the CSR Committee and Risk Management and Sustainability Initiatives company; Ms. Suneeta Reddy, Independent Director, Chairperson of the CSR Committee and member of the Risk Management and Sustainability Initiatives Committee. She is participating from Delhi; Mr. Sidharth Birla, Independent Director, Chairman of the Risk Management and Sustainability Initiatives Committee and member of the Audit Committee, NRC and SRC. He is participating from Delhi; Mr. Manish Tiwary, Managing Director, Designate and key managerial personnel of the company; Mr. Pramod Kumar Rai, Company Secretary and Compliance Officer of the company. The company's secretary has advised me that the quorum as required under law is fulfilled, and I declare the meeting as validly convened. I also acknowledge participation of the statutory auditors, cost auditors and the secretarial auditors. Ladies and gentlemen, I am delighted to welcome each one of you for taking time out to attend the extraordinary general meeting. It is my privilege to address you one more time before I retire as the Chairman and Managing Director of Nestle India. As all of you are aware, the directors of your company have convened this EGM to seek your approval for the issuance of bonus equity shares in the ratio of 1:1 by capitalizing a sum not exceeding INR 96.42 crore out of retained earnings of the company. If all members recall, the share price of the company reached over INR 24,000 per equity share in October 2023 and to make the equity shares more affordable as well as to encourage broader participation by retail investors, your company subdivided the equity shares in a ratio of 10:1 in January 2024. The impact was very clear. Since then, the trading volume has increased multifold and the number of shareholders have gone up from 180,000 to over 550,000. At the meeting of the Board of Directors held on 26 June 2025, your directors decided to issue bonus equity shares in the ratio of 1:1 to further encourage the participation of retail shareholders and to recognize the steadfast support and loyalty of the members throughout the company's growth and transformation journey. This initiative is likely to improve the liquidity of the shares and further broaden the shareholder base. I'm absolutely delighted to share that this will also benefit over 45,000 members holding only 1 equity share. To share some more details as on 31st March, 2025, the retained earnings of the company stood at INR 4,008.95 crores. This includes INR 837.43 crores reclassified from general reserves in the year 2023 in accordance with the scheme of arrangement approved by the National Company Law Tribunal, Delhi Branch. It is proposed to utilize INR 96.42 crores from the reclassified amount for the issuance of bonus equity shares. Members may visit the company's website to access the order of the honorable National Company Law Tribunal and the scheme. Further, to facilitate issuance of bonus equity shares as envisage, your directors recommend increase in the authorized share capital of the company from the present INR 100 crores to INR 200 crores by creation of an additional INR 100 crore equity shares of INR 1 each and consequent alternation of capital clause and Memorandum of Association. On behalf of the Board of Directors, I would like to especially thank you all for your support and confidence in your company over the years. Thank you all very much. I will now take up the notice of the extraordinary general meeting dated 26th June 2025, which has been duly sent to the members by e-mail and public notice published in newspapers as stipulated. Your company provided members with a remote e-voting facility on the EGM agenda items from 21st July, starting at 9 a.m. to 23rd July 2025, ending at 5 p.m. E-voting facility is available to the members during the meeting and after the resolutions are put to vote. Only those members are allowed to vote who are participating in the meeting but have not cast their votes using remote e-voting facility. The icon for e-voting is available on the top of your screen, which will redirect you with the e-voting portal of NSDL. The e-voting facility is active and will be closed along with the closure of this meeting. I will now proceed with the agenda as per the notice of the extraordinary general meeting with 2 special business listed as agenda item #1 and #2. Agenda item #1, to approve issue of bonus equity shares to the members of the company in the ratio of 1:1 and agenda item #2, to approve increase in the authorized share capital and consequent alteration to the capital clause of the Memorandum of Association. I will now move to the question-and-answer session. Now we would like to give an opportunity to the preregistered members to speak specifically with regard to the ordinary resolutions as set out in the EGM notice. Since both our agenda items are related to issuance of bonus shares, and there is no other item. I will be answering all your questions in one go at the end of the Q&A session. I now request Inba to invite their team members. In the interest of time, I would request sincerely all speakers to restrict their questions to the agenda items specific to the issue of bonus equity shares and to a maximum of 2 minutes.

[Operator Instructions] We will now invite our first speaker member. Mr. Jaydip Bakshi from Kolkata, having client ID 36203908.

Myself, Jaydip Bakshi, connecting from the city of Kolkata. Just I have one suggestion that I support the resolutions for today's EGM. Thank you, sir, and wish the company all the best in the coming years. Thank you, sir.

Thank you, Mr. Bakshi. Thank you very much for your support. Thank you.

We now invite our speaker number two, Ms. Celestine Elizabeth Mascarenhas from Mumbai. Client ID 00090218 to speak. It looks like Mrs. Mascarenhas is experiencing some technical issue. We're not able to unmute her connection. In the meanwhile, we'll move to our speaker, number three. That's Ms. Prakashini Ganesh Shenoy from Gurugram, client ID 12451107 to speak. I would also request all speaker shareholders to ask questions related to items listed in the EGM notice only.

Yes, am I audible, sir?

Yes, you are audible, ma'am.

Sir, chairman, sir, I'm also glad to see that -- meet you for the second time during the year before your retirement. I'm Prakashini Ganesh Shenoy from Bombay, respected Honorable Chairman, Mr. Suresh Narayananji, other dignitaries on the Board and my fellow shareholders, good afternoon to all of you. I received the EGM report well in time, which is self-explanatory. I thank the Company Secretary and the team for the same. The Chairman has given everything regarding the EGM. So I have no questions, but I thank him for issue of bonus, 1:1, for each and every shareholder. Thank you. Chairman sir, once again, I wish you happy, healthy, wealthy retired life. I wish the company good luck for a bright future and pray God that the profit of the company shall reach the peak in due course. Sir, I strongly and wholeheartedly support the resolution put forth in today's meeting. Chairman sir, last but not the least, I request you once again to please continue with VC so that people all over will have an opportunity to experience their view. Thank you, Chairman, sir.

Thank you. Thank you. Thank you, Mrs. Shenoy. Thank you very much for your good wishes and for your support of the resolution. It is much appreciated. Thank you very much.

Thank you. We now move to our speaker number four, Mr. Yash Pal Chopra from Delhi, client ID 10592847 to speak.

Am I audible now?

You are audible, sir.

[indiscernible]

Mr. Chopra, sorry to interrupt. I'm going to mute your -- sir, I'm saying I'll mute your camera to conserve your bandwidth, sir. You may now continue speaking because your audio was breaking up. Go ahead, sir.

Yes. Hello?

We can hear you better, sir. Thank you. Go ahead.

Hello, am I audible?

Yes, you are audible, Mr. Chopra.

Sir, you just given us a farewell gift, [indiscernible] hard at this very, very long-standing given for our shareholders that split, [indiscernible], sir, we are very, very proud of you, we love you like everything and lord blessing [indiscernible]. Just yesterday, I attended meeting that [indiscernible] and as the [indiscernible]. So I told her that you required him a [indiscernible] sector and [indiscernible] would lucky just to see you there, earlier I was saying that in the last year since we [indiscernible] wish you better luck for coming days and for new [indiscernible] and from the heart core of my heart, I think you are [indiscernible] things and granted on it and deserves the best, so long live, happily we will all remember you, the best luck to you, thank you.

Thank you. Thank you, Mr. Chopra. Thank you very much for your blessings and good wishes. I'm sorry, I could not see your smiling phase today because of bandwidth. But I thank you and deeply appreciate your good wishes for the company and for me personally. Thank you very much.

Our next speaker member is Mr. Himanshu A Trivedi from Vadodara. Client ID 00688192. Sir, we can hear you. Please go ahead.

I'm audible?

Yes.

Yes. Respected Chairman, Suresh Narayanan and other board of directors sitting on the dais. Myself, Himanshu Trivedi from Vadodara, Gujarat state. First of all, I'm thankful to our company secretary sending a notice well in time, which is full of information and fact figures all in place. This meeting is for the agenda of our bonus share. I'm very happy, thankful to you and that you have been given the bonus share, sir. I wish good luck and best bright future in next financial year. Thank you allowing me to speak.

Thank you very much, Mr. Trivedi. Thank you. Much appreciate your support and much appreciate your good wishes for the company and for me personally. Thank you.

Our next speaker, Mr. Santosh Chopra from Ghaziabad had registered. However, he is not connected to the meeting. We will, therefore, move to our speaker, Mr. Atanu Saha from Kolkata, client ID 12863390 to speak. It looks like Mr. Saha just got dropped off. In case if he joins back to the meeting, we will unmute his connection. We'll move to our next speaker member. Mr. Ashish Shankar Bansal from Kolkata with client ID 00164334. Mr. Bansal, could you please go ahead with your question?

Respected Chairman and Board of Directors, first thank you for giving us dividend. Just sir, I want to know you can take from -- you wanting, why you've keep it specially [indiscernible] EGM. I already miss you next year in EGM. Thank you so much, sir.

Thank you. Thank you, Mr. Bansal. Thank you for your good wishes, and thank you very much for everything. I think we have held this as an extraordinary general meeting because it merits that consideration. Thank you.

We'll invite our next speaker member. Mrs. H.S. Patel, who would like to ask a question over audio.

Thank you so much. I -- first of all, I wish the company all the very best for the continuous support that they have given. Only thing I wanted to inform you that at the Nestle AGM, I was not allowed to speak. I do not know why. Priyansha, thank you very much for giving this opportunity. Mr. Pramod Rai, please, if given the opportunity, please see that this is an AGM. This is an AGM for the shareholders. So importance has to be given to the shareholders. In other meetings, just now, there is also another meeting going on at the same time. It becomes very difficult to coincide with both the meetings. Anyway, so over here, Mr. Pramod Rai, see to it that during the AGM, we are given importance in this meeting. Also it is once in a year, we are having AGM. And please do not throw us out of our chance at the AGM, okay? Directors meet often occurs at least 8 or 10 times in a year, but AGM occurs only once in a year. You have never even wanted to give us ring even 1 or 2 times in at least now at AGM time also, no information, nothing about you has come. As a compliance officer, as a company secretary, at least once in a year, please do try to speak to us.

Sorry to interrupt, Mrs. Patel. May we request you to please ask any questions related to the agenda.

This is the question earlier. I'm asking, ma'am. Please. And hello, I'm very much favor of this bonus issue. I approve of it. And I shall keep my continuous support to the company, and I will -- I support all the resolutions. Thank you very much. And please see to it that shareholders are given chance at AGM.

Thank you. Thank you, Ms. Patel. Thank you very much for your support on the resolution. I would -- my apologies if you have ever felt neglected, but that is not the issue at all. Shareholders are the most important people on the AGM and also on the extraordinary general meeting, and you should not have any feelings, that is not the case. But however, thank you for your support for the company, and thank you for the support on the resolution.

So we will take questions -- a question from Mrs. Mascarenhas to see if she is able to unmute. Mrs. Mascarenhas, we've sent you a prompt to unmute your microphone, could you unmute and ask your question.

[indiscernible] very good but what has happened is good return, good interim dividend...

Mrs. Mascarenhas, you are on the Nestle EGM, ma’am, could you ask your question now?

Nestle.

Yes, sir. Please go ahead.

Nestle on the other call. I'll continue speaking. I'm also a shareholder.

Yes, sir. Please go ahead with your question, Mr. Mascarenhas.

Yes. Yes, respective Chairman, sir, my madam, respected Chairman, the Board and my fellow shareholders, good evening to you all. My name is Aloysius Mascarenhas, I'm an esteemed shareholder, proud shareholder of this prestigious company, which has rewarded shareholders year after year with very good dividend, very good market cap, very good products in the market. We are intentionally known company, we are very good with the bonus declared. We looking forward -- constantly our company declares bonus, very high dividend. We appreciate. Yes, so I have -- my full kudos to the company, going forward. And I appreciate many things, the shareholders requirement are given. So I end my speech, wishing you personally, all the Board members and more importantly, all the employees, all the very best in the days and years to come. With this, thank you very much for patient hearing, good health, good luck and goodbye. Thank you for patient hearing.

Thank you, Mr. Mascarenhas. Thank you for all your good wishes and all your blessings and your kind words for the company. I do recall that a few years back, you had spoken to me, your wife had spoken to me from Japan, I really appreciate the commitment that you have to the company to join in the AGM or the EGM from wherever you are. Much appreciated, and your wishes are very much valuable for the company. Thank you very much.

So we'll take our last question from Atanu Saha. He's joined the meeting. Mr. Atanu Saha, could you please unmute your connection and ask your question? There seems to be no response from this connection. Chairman, that was the last question. I hand it back to you for further proceedings.

With that, we have completed all the speakers, thanks to all the speakers participating from across the country for their comments and questions. We have tried our best to answer the questions and also respond to the comments that have been made. As explained earlier, members present at the EGM, but who have not cast their votes by availing the remote e-voting facility and exercise their vote through electronic voting platform provided by NSDL, the icon of which is available on the top of your screen. You will be redirected to the e-voting portal of the NSDL. What you should know before you vote, and it is a matter of governance that I inform you as the Chairman as per the NCLT order, the company proposes to use around INR 837 crores reclassified from general reserves in 2023. The bonus issue itself will utilize INR 96.42 crores, out of the above INR 837 crores, which forms part of the overall retained earnings of around INR 4,000 crores. So this is to amply clarify for you the method by which the bonus shares would be issued. Mr. Abhinav Khosla, Partner M/s SCV & Company LLP, chartered accountants will scrutinize the votes cast through remote e-voting and votes cast during the EGM on e-voting platform as provided by NSDL. Mr. Abhinav Khosla will submit the report thereon to me as the Chairman or to the company's Secretary duly authorized in the prescribed manner. The voting results in all the resolutions placed before the EGM would be declared not later than around 6:00 p.m. tomorrow and shall be immediately intimated to the stock exchange, the results along with the report of the scrutinizer will be uploaded on the website of the company and NSDL and shall also be available at the registered office of the company. I now wish to draw the attention of all the members participating in the EGM that the e-voting platform provided by NSDL will remain open for another 30, 3-0 minutes. Thank you all for your participation and support. The proceedings of the meeting will close after all the members participating in the meeting have cast their vote to e-voting, which will, I repeat, lapse after 30 minutes. Thank you all very much for your participation. Wish you the very best of luck, and thank you all for your good wishes for me as I retire from the company. Thank you. [Voting]

Dear members, as advised by the scrutinizers -- as instructed by the scrutinizers, request all the members participating in the EGM and who have not cast their vote to cast their vote in the remaining period of 10 minutes. Thank you. Dear members, as advised by the scrutinizers, the time for e-voting has elapsed, and they are of the opinion that all members who are participating in the Extraordinary General Meeting have been given adequate time and opportunity to vote at the EGM. This concludes the voting process of EGM. I hand it back to the Chairman.

Thank you, Inba. The eligible and willing members have been given adequate time and opportunity to cast their votes. I formally close the proceedings of the meeting. Once again, thank you all very much, and best of luck to you. Thank you.