Nestlé to establish new food plant in India

Nestlé India, a subsidiary of Swiss food company Nestlé, plans to invest Rs5bn ($92.18m) to establish a food production plant in Gujarat, a state in western India, in 2012.

The new plant will produce confectionery products and Maggie noodles, for which the company plans to procure wheat locally.

The company is currently seeking about 50 to 100 acres of land for the plant, preferably near Ahmedabad.

Nestlé chairman and managing director Antonio Helio Waszyk said the company is in an advanced stage of preparation and would finalise the plans by mid-2012.

"If things go according to our plans, we would start manufacturing in 2014-15," Waszyk said.

Nestlé also plans to set up its ninth plant in Bihar to expand its presence in eastern India.

These plans are a part of the company’s strategy to expand in the western and eastern states of India, by doubling production capacities.

Although Nestlé is into dairy production, it currently does not have any plans to enter into the dairy sector in Gujarat, where Gujarat Co-operative Milk Marketing Federation (GCMMF), the marketer of the Amul brand of milk and dairy products, has a strong presence.

Nestlé procures 13 lakh litres of milk from lakh farmers in the states of Punjab, Haryana, Maharashtra and Rajasthan.

The Swiss company, which first set up its production plant in Punjab in 1961, has seven manufacturing facilities in Tamil Nadu, Karnataka, Haryana, Goa, Uttarakhand and Himachal Pradesh, and is set to open its Rs2.3bn ($42.40m) R&D facility in the Haryana in 2012.

Nestlé India, which is currently involved in four segments – milk and nutrition, foods, coffee and beverages and confectionary, reported net sales of Rs62.55bn ($1.14bn) and a net profit of Rs8.19bn ($151m) for the financial year 2010.

Caption: Nestlé India is currently seeking about 50 to 100 acres of land for the proposed plant, preferably near Ahmedabad.