“Nestlé is not just a food company and a new complexion of Nestlé will be clearly visible in 5-10 years,” says Suresh Narayanan, CMD of the Indian arm, who took up the baton in the middle of the Maggi crisis in 2015.
The nutrition business is being strengthened with new products — many of which are highly specialised and prescription-based. During the past few months, the firm has launched two premium products — Human Milk Fortifier (HMF) and Nan Excella Pro. While, the HMF is targeted towards pre-term babies, Excella Pro is a premium offering added to its flagship infant milk substitute brand Nan Pro. Apart from helping the firm subsidise its other mass-market products in the category, these will help in increasing credibility of Nestlé, Narayanan hopes.
Its nutrition division, which has a dedicated field force of some 800 officials, will be leveraged in coming days. The firm has more products in the pipeline in the balanced nutrition and in-between meal categories, which mostly remained unexplored in India. Some 57 per cent of its total sales in 2015 came from milk and nutrition business but its market share and volume sales are under pressure.
Narayanan says managing costs and leveraging the investments in recent years will be the key to its turnaround. “These are our stronghold areas globally and we have great potential in India due to the kind of investments that we have made so far in R&D and technological innovations. In the past couple of years we have invested Rs 5,000 crore”, he said.
However, it is the health sciences business, which Nestlé SA acquired in 2007 from Swiss pharma giant Novartis, could hold the key. Globally, the firm owns over a dozen brands in this segment but in India it has only one brand, Peptamen.
“These are the kind of business where the surefootedness of Nestlé as an expert company in science will be established here and that’s why it is important for us. The trust and credibility that we gain will strengthen the base of the company” Narayanan says. “We are evaluating options like launching products from our global portfolio to address Alzheimer’s, cancer, kidney ailments, obesity, post-operative care, diabetes. We will be launching a few brands soon, including Resource. We are planning to produce these products locally. As the size of the health care sector is growing, hospitals are also looking to offer world-class services. So, this is the time when we should increase our focus in the area”.