Shareholders of Nestle India have rejected a proposal to raise royalty payments to Nestle SA, the parent company of the packaged foods maker.
Nestle India Ltd shareholders have rejected the company’s proposal to increase the royalty payout to its Swiss parent. The resolution failed to pass, with 57% of shareholders voting against the plan, as reported by the packaged foods maker in a stock exchange filing on Friday.
The proposal aimed to raise the royalty by 0.15% of sales annually for a period of five years. The adjusted payout was scheduled to take effect on July 1st.
Last month, the producer of Maggi noodles and Nescafe coffee unveiled a proposal to incrementally raise the licensing fees from the current 4.5% to 5.25% of net sales over a five-year period.
Seventy percent of the company’s public shareholders and 57 percent of all shareholders opposed the proposed increase in royalty payments to the Swiss parent company, which happens to be the world’s largest packaged foods maker.
Abneesh Roy, Executive Director at Nuvama Institutional Equities, expressed that this development represents a significant positive for Nestle.
Nestle India reported a 27% increase in net profit, reaching INR 934 crore for the fourth quarter ended March 2024, compared to INR 737 crore in the year-ago period. This growth was attributed to strong demand and lower material costs. Revenues from operations also saw a 9% increase to INR 5,268 crore in the quarter, from INR 4,830.5 crore in the year-ago period.
The company has now finalized an agreement with Dr. Reddy’s Laboratories to establish a joint venture aimed at introducing a range of nutraceutical brands, encompassing vitamins, minerals, herbal, and supplements sourced from Nestle Health Science (NHSc). Under the terms, Dr. Reddy’s will retain a 51% stake, while Nestle India will own 49% in the venture. Additionally, Nestle India retains the option to boost its ownership to 60% after six years, subject to fair market valuation.
Samsonite, Safari, and VIP Industries, renowned luggage manufacturers, experienced a notable decrease in their growth rates during the March quarter. This decline can be attributed to the comparably high base set last year, coupled with a subdued wedding and travel season this year.
Samsonite’s Indian operations experienced a 10% decline year-on-year during the quarter, a notable shift from the 108% growth observed a year earlier. Meanwhile, Safari witnessed a drop in its growth rate to 21% from the previous year’s 57%. Similarly, VIP Industries saw its sales growth moderate to 14% from 26% a year ago. Despite this, most companies in the sector anticipate continued growth, albeit not at the same accelerated pace witnessed immediately following the Covid-19 pandemic.
Jai Krishnan, CEO of Samsonite South Asia, remarked, “The pandemic has fundamentally reshaped travel patterns and frequency. The performance this quarter represents a transient dip primarily driven by a high baseline, given our business has doubled over the past three years, a pace that isn’t sustainable every quarter. However, our optimism persists that the sector won’t encounter a long-term slowdown, although the growth rate may fluctuate.”
During its global earnings call, Samsonite, the largest luggage manufacturer worldwide based in the US, noted that its Indian operations might show a decrease compared to past performance levels, which witnessed a doubling of sales. However, it anticipates a mid-single-digit growth trajectory due to the high baseline.
Reza Taleghani, the Chief Financial Officer at Samsonite, informed analysts, “In India, we encounter robust competition from strong players occupying the second and third positions. There’s a noticeable trend of promotional activities in the Indian market, with competitors also engaging in discounting practices. Consequently, there’s a significant accumulation of inventory. Overall, the Indian market is characterized by a proliferation of bags.”
In 2022, India surpassed China to become Samsonite’s largest market worldwide. However, a year later, China reclaimed the top position after relaxing travel restrictions.
The Indian luggage industry is valued at just under INR 50,000 crore, with organized players representing approximately a quarter of the market. VIP Industries, Samsonite, and Safari collectively dominate almost 90% of the branded segment. Over recent years, the sector has witnessed consistent growth, driven by evolving lifestyles, an expanding middle class, and the accessibility of affordable air travel. However, growth came to a standstill during the initial year of the pandemic.
Neetu Kashiramka, the Managing Director at VIP Industries, shared with analysts, “Our confidence in achieving double-digit growth for the year stems from several factors. Firstly, we believe that by executing our strategies effectively, we can enhance our market share. Additionally, considering industry forecasts suggesting a 12% growth rate, we aim to surpass this by 1% or 2%, hence projecting double-digit growth. Moreover, the positive performance indicators from the travel sector, as evidenced by airline and hotel industry data, further bolster our optimism.”
Consumers are increasingly favoring hard luggage due to its enhanced aesthetics and durability. Over the last five fiscal years, the market share of hard luggage has surged from 33% to 55%. According to a recent report by RedSeer, the phenomenon of “revenge tourism” is motivating consumers to travel more and invest in high-quality luggage. Brands are responding with competitive pricing strategies to stimulate sales, while a government reduction in goods and services tax has made branded luggage more affordable, reducing the price disparity between branded and unbranded options.
As the Indian Premier League (IPL) reaches its playoff (elimination) stage, bars, pubs, and cafes are seizing the opportunity to attract fans. With a heatwave sweeping across the region, many cricket enthusiasts are opting for the air-conditioned comfort of these venues instead of enduring the intense heat in the stadiums, according to industry executives.
Bars and pubs are enhancing their offerings with live screenings, aiming to recreate a stadium-like atmosphere. They are introducing curated sports menus, cocktails, beer buckets, and staff dressed in IPL jerseys. Some establishments are even providing team apparel and merchandise to elevate the experience.
It’s important to note that elections in Mumbai on May 20 and in Delhi-Gurgaon on May 25 will result in alcohol-free dry days in those regions. However, executives are confident they will compensate for this in other states. Additionally, they believe that the group-watching atmosphere will attract people even without the presence of alcohol.
“Sports bars that depend heavily on alcohol sales might see a slight dip in revenue during the earlier matches,” said Abhilash Menon, director at Studs Sports Bar & Grill.
“However, we still anticipate that fans will attend the games in order to enjoy the food along with other refreshments in addition to the booze. In general, even on the dry days, a lot of people should be drawn in by the excitement of the IPL.”
Constituencies enforce dry days starting two days before polling and continuing through election day. In Delhi, for instance, this period lasts from 6 pm on May 23 to 6 pm on May 25. However, the semifinals begin on May 21, allowing Mumbaikars to enjoy their favorite drinks during the final stages of the tournament.
The final is scheduled for May 26 in Chennai.
“The IPL is scoring higher and higher, as I’ve noticed. More patrons at our bars are expected as it moves into the playoffs,” stated AD Singh, MD of the Olive group of restaurants, which includes Olive Bar & Kitchen, Monkey Bar and SodaBottleOpenerWala.
“At Social, we’re branding ourselves as the #DoosraStadium,” said Riyaaz Amlani, MD of Impresario Entertainment and Hospitality, which operates Social and Smoke House Deli. During IPL 2023, the chain experienced a 20-30% increase in order volumes.
Monkey Bar, Olive, Social, Yes Minister, Beer Cafe, Tap Room, Jamie’s Oliver, Whisky Samba, Studs Sports Bar, The Sassy Spoon, and Baraza Resto Bars are some of the establishments capitalizing on the final two weeks of the IPL. “In addition to live screenings, we’re setting up spaces for team-versus-team events as the IPL progresses into the knockout stages,” said Ashish Kapur, promoter of Whisky Samba and Wine Co.
The 10-team tournament commenced on March 22 and concludes on May 26. Executives mentioned that they are heightening the IPL excitement at their venues, drawing from the statistics of previous years. The screenings offer a blend of sports and gastronomy, according to Jasper Reid, founder of Dolomite Restaurants, which manages Jamie’s Oliver’s Kitchen and Pizzeria.
Bookings are rapidly filling up, with numerous customers reserving tables well ahead of time, noted Miten Shah, director at Studs Sports Bar & Grill, owned by Ambros World Foods. The Mumbai-based sports bar has outlets in 11 cities.
Rising summer temperatures, with the capital exceeding 45 degrees Celsius, have driven fans to pubs and bars rather than stadiums, according to executives.
“It’s uncomfortable to watch a game in a stadium amid this intense heat wave. As a result, we’ve noticed a significant increase in foot traffic as fans choose our bars’ chillier atmosphere when watching games with friends and family,” said Rahul Singh, Senior Vice President of Pubs at Bira 91 and Chief Executive of pub chain The Beer Cafe.
Dhruv Anand Goyale, Chief Executive of Yes Minister Bowling, Bar & Kitchen, situated at New Delhi’s Essex Farms, mentioned the venue offers “mega guzzler cocktail menus” along with in-house celebrations and performances specifically designed for the IPL.
LT Foods, the parent company of the renowned basmati rice labels ‘Daawat’ and ‘Royal’, reported a 14 percent jump in consolidated net profit at INR 150.24 crore for the fourth quarter of fiscal 2023-24 on robust sales. The company’s profit stood at INR 131.81 crore a year earlier.
According to a regulatory filing, total income increased to INR 2,091.73 crore during the January-March quarter of 2023-24, compared to INR 1,834.95 crore in the corresponding period of the previous year.
Expenditures remained elevated at INR 1,898.46 crore compared to INR 1,685.92 crore from the previous year.
For the full fiscal year 2023-24, LT Foods reported a net profit of INR 597.59 crore, marking a 41.35 percent increase compared to INR 422.75 crore in the previous year.
Total income increased to INR 7,822.05 crore, up from INR 6,978.81 crore the previous year.
Commenting on the performance, LT Foods Managing Director Ashwani Arora stated that the company achieved stellar growth in both revenue and profitability for yet another year, despite a challenging external environment.
He stated that the three key segments—Basmati and other specialty rice, organic food and ingredients, and Ready-to-Eat and Ready-to-Cook products—have collectively delivered an impressive 12 percent year-on-year (YoY) growth.
“This steady growth underscores our strategic focus on continuous investment on brands across geographies and innovation, which has substantially bolstered our domestic and international market position,” he stated.
By 1500 hours on Friday, shares in LT Foods climbed 0.44 percent to INR 229.40 on the Bombay Stock Exchange.
Subko Coffee Roasters, a Mumbai-based specialty coffee and craft-baked goods brand, reported sales of INR 13.5 Cr in the financial year ended March 31, 2023. This marked a 94% increase from the INR 7 Cr operating revenue it posted in the previous fiscal year.
Subko Coffee generates revenue by retailing coffee and bakery items via its cafes and online platform. According to its financial records, the majority of its earnings, amounting to INR 13.4 Cr, stemmed from coffee product sales during FY23.
During the fiscal year FY23, the net loss surged to INR 9.1 Cr, up from INR 1.7 Cr in the preceding fiscal period.
Expenditure surged by 176% to INR 23.4 Cr in the fiscal year under review, up from INR 8.5 Cr in FY22, reflecting the robust expansion of the startup’s operations.
Employee costs were the largest expenditure for the specialty coffee startup. During the year under review, it spent INR 6.6 crore on employee benefit expenses, marking a 154% increase from INR 2.6 crore. This suggests the startup has been expanding its workforce.
Subko Coffee spent INR 3.8 crore on procuring raw materials for coffee, bakehouse, and cacao products in FY23, a 58% increase from INR 2.4 crore in FY22.
The startup’s rent expenditure more than doubled, rising to INR 2 crore in FY23 from INR 70 lakh in the previous fiscal year.
EBITDA loss amounted to INR 8.2 crore, up from INR 87 lakh in FY22. The EBITDA margin was -60.5% during the year under review, compared to -12.46% in the previous fiscal year.
Founded in 2020 by Rahul Reddy, Subko Coffee claims to source coffee beans, fine cacao, and wheat directly from farmers. In addition to its website, it sells its products through its flagship cafes and ‘mini’ pop-up stores.
Earlier this year, the startup raised approximately $10 million in funding from Nikhil Kamath, reaching a valuation of $34 million. The round also included contributions from Blume Founders Fund, The Gauri Khan Family Trust, John Abraham and his wife Priya, among others.
The startup said it will utilize the fresh funds for talent acquisition, developing tech-driven customer experiences, product and design research, improving farm-level infrastructure for specialty green coffee and fine cacao beans, and launching new ‘ready to drink’ coffee products.
Subko Coffee competes with emerging specialty coffee brands like Third Wave Coffee, Blue Tokai, and abCoffee.
With alcohol prices rising at shops, bars, and pubs, and bar closing times reduced from 2 AM to midnight for those with a base license, the new excise policy in Haryana may dampen the spirits of many NCR residents who used to flock to Gurgaon for late-night partying.
According to the 2024-25 excise policy, bars in Gurgaon with a base license can only operate until midnight. To stay open until 2 AM, they must pay an additional INR 20 lakh, and INR 5 lakh for each hour beyond that. This new policy has shocked many in the business community, who had praised last year’s policy as “highly progressive.” Previously, licensed bars could remain open until 2 AM with a base license, with an option to extend until 8 AM for an additional annual fee of INR 20 lakh. Before 2023, Gurgaon bars could stay open until 1 AM, with a one-hour extension available for an additional annual fee of INR 10 lakh, and further extensions until 6 AM for an extra fee of INR 20 lakh.
Reports indicate that beer prices are expected to increase by 20 percent for a case containing 12 or 24 bottles. The cost of Indian Made Foreign Liquor (IMFL) is anticipated to rise by 15 percent per bottle, while the prices for imported foreign liquor are projected to increase by 12-15 percent per bottle.
Restaurateurs warn that the increased license fees will be difficult for businesses to manage and will negatively impact consumers and Gurgaon’s nightlife.
“Bars will have to raise prices to cover operating expenses. It’s a significant setback, as Gurgaon’s nightlife was steadily gaining a strong reputation. Over the years, the city had become a late-night party hub with bars operating until 2 AM. With the new policy, I don’t expect the NCR crowd to come to Gurgaon anymore,” says restaurateur Sahil Sambhi.
Restaurateur Rahul Singh adds, “In Gurgaon, a large part of the population works in the corporate sector. Due to their long working hours, many residents unwind at restaurants and cafes late at night. The reduction in liquor-serving hours, along with the exorbitant fees for staying open past midnight, is not commercially feasible for most restaurants.”
“Local markets in Gurgaon are renowned for being home to numerous tiny eateries, many of which flourish when given a base licence that allows them to stay open until two in the morning. The late-night business crowd frequently congregates in these bars. These establishments will have to reduce their hours because they are unable to afford the extra costs associated with remaining open until 2 AM. As a result, consumers will have fewer options to select from,” believes restaurateur Vikrant Batra.
Restaurateur Umang Tiwari adds, “Most BYOB outlets are already operating like restaurants, and small bars and restaurants are suffering losses. The new excise policy and increased costs will make it very difficult for them to survive.” Restaurateur Varun Khera notes that “the new excise policy means every restaurant and bar will have to pay a high price for each operational hour, raising overall operating costs and impacting consumers with higher prices.”
The Indian Bakers Federation (IBF) has announced the inauguration of its Delhi/NCR/NCR Chapter, scheduled for May 18th, 2024, in New Delhi. This event signifies a significant expansion of the IBF’s mission to foster business growth, collaboration, and innovation across India.
Dr. R.K. Bharti, IEDS, Joined Director & HOO, Gov. of India, Ministry of MSME will be the distinguished Chief Guest for the inauguration ceremony. Dr. Bharti’s leadership and vision underscore the significance of the IBF’s initiatives in bolstering the baking community in Delhi/NCR and beyond.
During the inauguration event, Dr. R.K. Bharti will deliver a keynote address, emphasizing the crucial role of collaborative endeavors in fostering economic advancement. Subsequently, attendees can look forward to a series of interactive sessions and networking opportunities tailored to facilitate connections among business leaders, entrepreneurs, and professionals across various industries.
The event promises a rich array of highlights, including a keynote presentation by Dr. R.K. Bharti, IEDS, who recently assumed the role of Director & HOO at the Government of India’s Ministry of MSME. Dr. Bharti will shed light on the intricacies of the bakery business landscape in India. Additionally, attendees can anticipate inaugural addresses by Mr. Balraj KR, National Convener of IBF, and other senior members of IBF, who will delve into the prevailing trends, challenges, and opportunities within various sectors of the bakery industry in India. Moreover, the event will offer networking sessions designed to facilitate meaningful connections among business professionals and leaders, fostering collaboration and knowledge exchange.
Gaurav Dhingra, Vice President of IBF, conveyed his excitement regarding the launch of the Delhi/NCR Chapter, stating, “The establishment of the IBF’s Delhi/NCR Chapter underscores our dedication to empowering the business community within one of India’s most dynamic economic centers. With the backing of esteemed leaders and our members, we are primed to exert a substantial influence on the national bakery industry landscape.”
The IBF Delhi/NCR Chapter is positioned to serve as a crucial platform for business networking, offering resources and opportunities to support the growth of businesses. The event will take place at Cypress Hall, India Habitat Centre, New Delhi, on Saturday, 18th May 2024, at 3:00 pm.
Pending regulatory approval and other standard closing conditions, the deal is slated to be completed in the first half of 2025. Moreover, Uber will purchase $300 million worth of newly issued ordinary shares of Delivery Hero.
Following the transaction’s completion, Foodpanda’s local consumers, merchants, and delivery partners will transition to Uber Eats.
The agreement combines Uber’s global marketplace expertise with Foodpanda’s established presence in Taiwan and its partnerships with popular local brands. This collaboration aims to broaden consumer choices across different food categories and price ranges by consolidating the diverse groups of merchants from Uber Eats and Foodpanda onto a unified platform, according to the company’s statement.
For instance, the merger will provide consumers with benefits like Uber’s broad coverage in northern Taiwan and major cities, complemented by Foodpanda’s robust presence in southern Taiwan and smaller urban areas.
Niklas Östberg, CEO and co-founder of Delivery Hero, expressed, “The success of our Taiwanese business is a result of the dedication of numerous teams over the past eight years. To establish a globally renowned service, we’ve determined that redirecting our resources to other areas of our global footprint, where we can make the greatest difference for customers, vendors, and riders, is necessary. This agreement provides Foodpanda with an exciting opportunity in Taiwan, and we extend our best wishes to them as they embark on their next phase.”
Pierre-Dimitri Gore-Coty, Senior Vice President of Delivery at Uber, remarked, “Uniting our unique customer bases, merchant offerings, and geographical reach will enable us to offer greater choices and competitive prices for consumers, increased demand for restaurants, and enhanced earning potential for delivery partners.”
“Online meal delivery services still make up a relatively little portion of the food delivery market here. We can’t wait to use this transaction to unlock even more convenience and value in the years to come.”
Upon finalization, the deal would stand as “one of the largest ever international acquisitions in Taiwan,” with the exception of the semiconductor sector.
Hotel operators, who previously slashed jobs in large numbers during the Covid era, are now re-entering the market with vigor, hiring thousands to support their ambitious expansion strategies and address vacancies stemming from significant attrition rates.
TeamLease Services, a staffing services firm, anticipates the creation of approximately 200,000 jobs in the hotel, restaurant, and tourism sectors within the next 12-18 months. Balasubramanian A, Vice President and Head of Consumer, Hospitality, and E-commerce at TeamLease, projects that roughly half of these positions will be within the hotel industry.
Hotels in various sectors are increasing their staff to meet expansions into new areas and the installation of more rooms, fueled by a strong increase in business as well as leisure travel. Balasubramanian stated that the vacancies being filled include a mix of permanent, temporary, & gig work.
Chander K Baljee, Chairman and Managing Director of mid-tier Royal Orchid Hotels, stated, “We plan to increase our room count by about 2,000 this year across our various properties and aim to recruit approximately 5,000 individuals across various levels.” Industry executives and staffing firms report significant attrition rates, ranging from 30-50% per month for many small and mid-tier hotels, leading to a notable upsurge in replacement hiring.
“Out of our workforce totaling 8,000 employees, we experienced attrition rates ranging from 30-35%,” remarked Baljee. “These vacancies must be filled.”
Royal Orchid intends to introduce three fresh brands, one of which is a premium five-star brand. The company has already secured a new property with 300 rooms in Mumbai for this upscale venture.
Its existing portfolio comprises slightly over 100 hotels, totaling close to 6,000 rooms. The majority of its forthcoming 2,000-room inventory will be situated in western India, with subsequent expansions planned for the north and east regions.
TeamLease estimates suggest that the annual count of domestic tourists in India may witness an increase of 10 million over the next one to two years, rising from the current range of 180-200 million.
Meanwhile, forecasts indicate a 20% growth in foreign tourist arrivals during the same period, with expectations of tripling within five to six years from the current annual figure of around 10 million. The hotel industry stands poised as a direct beneficiary of this anticipated surge in tourism.
Samir MC, the Managing Director of Fortune Hotels, anticipates an 8-10% increase in the company’s hiring this year compared to the previous one, propelled by their ambitious expansion initiatives.
Fortune Hotels manages over 5,000 rooms spanning 56 cities. According to him, they are currently recruiting for positions in the front desk, housekeeping, administrative, and food and beverage departments.
Lemon Tree, another mid-tier hotel operator, aims to incorporate approximately 2,000 rooms within this fiscal year, along with recruiting 3,000-4,000 individuals across various roles, as stated by Chairman and Managing Director Patu Keswani. He further noted, “This hiring encompasses the replacement of attrition, totaling 1,500.”
Despite significant job layoffs and reduced staffing levels due to the Covid-19 outbreak, the hotel business has recovered. We have seen a 20-25% spike in hotel demand over the previous year. This increased demand is coming from both current businesses and newly developed properties,” said Alok Kumar, President-Manpower of ManpowerGroup India.
“With the lifting of travel restrictions and the restoration of consumer confidence, both leisure and business travel are experiencing an upsurge. The demand for hotel accommodations has soared to unprecedented levels, prompting hotels to recruit additional staff to uphold service standards,” he further commented.
The most sought-after positions include front desk agents, concierges, guest relations managers, as well as housekeeping and maintenance staff.
Specialized roles such as maintenance technicians, chefs, and recreation managers are also witnessing high demand, with Manpower noting an increase of over 35% compared to the same quarter last year.
“The hotels and hospitality sector have seen at least a 20% year-over-year surge in demand for personnel,” Ciel HR Services Chief Executive Aditya Narayan Mishra said. “We are seeing huge demand for professionals across various fields such as marketing, sales, technical roles, as well as HR,” he went on to explain.
According to a recent report by ratings firm ICRA, the hotel industry is expected to achieve revenue growth ranging from 7% to 9% in fiscal year 2025.
Travel platforms have also increased their hiring efforts in response to the overall uptick in both leisure and business travel.
Ajay Sreedhara, Head of the People Function at the online travel firm Cleartrip, stated, “As our business expands, we have intensified our hiring efforts, particularly for numerous leadership roles… We are actively recruiting talent across various domains, including technology, product development, and business development. From product engineers to senior executives, we are eager to engage individuals with pertinent travel industry expertise.”
ITC Aashirvaad Salt has unveiled its latest offering: Himalayan Pink Salt. Also recognized as Sendha Namak or Saindhava Lavana in India, this salt variety is revered for its natural origins, hailing from the depths of the Himalayan salt mines.
To alleviate consumer concerns about unethical practices, such as the addition of artificial colors to achieve a pink hue, Aashirvaad Himalayan Pink Salt proudly guarantees “No added colors.” Its naturally deeper pink hue derives from the superior quality of salt sourced by Aashirvaad, setting it apart from other pink salts on the market. This distinction underscores Aashirvaad’s unwavering dedication to delivering premium, safe products to its discerning clientele.
Aashirvaad Himalayan Pink salt is enriched with vital minerals such as calcium and magnesium. Through gentle processing, this new addition elevates the taste of dishes while ensuring purity. Moreover, its multi-layer packaging preserves freshness, allowing consumers to instantly gauge its quality through the transparent strip.
Anuj Kumar Rustagi, Chief Operating Officer of Staples and Adjacencies, highlights, “Our consumer research revealed a growing preference for pink salt owing to its perceived health advantages. This prompted us to introduce Himalayan Pink Salt. Backed by Aashirvaad’s quality assurance, we eagerly anticipate a favorable response from our customers.”
Aashirvaad Pink Salt will be accessible at Modern Trade/ISS outlets in all major metropolitan areas, including Bangalore, Chennai, Mumbai, Delhi, Hyderabad, and Kolkata, as well as eCommerce/quick commerce platforms. The 1kg package is priced at INR 120.
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