Pet care business has exciting future, says Nestle India CMD

The pet care business has an exciting future and would be a growth driver for the company, said Nestle India Chairman and Managing Director Suresh Narayanan.

FMCG major Nestle India on Thursday announced to acquire the pet foods business of fellow subsidiary Purina Petcare India for Rs 123.5 crore, providing it access to this fast-growing business in the country.

Both Nestle India and Purina Petcare India are subsidiaries of Swiss major Nestle SA.

The Pet care business is estimated to be Rs 4,000 crore and the category is growing with a CAGR of 25 per cent, said Narayanan during the company’s earnings call on Thursday.

”Pet adoption is on the rise, especially after the pandemic,” Narayanan said, adding pet care is among the highest growing category now. Today there are an estimated 30 million pets in the country and is growing 11 per cent per annum.

While talking about Purina India business, he said it has built a Pet Specialty distribution network in 46 Towns. It has accelerated growth of 68 per cent in 2021 and 51 per cent in the first half of 2022.

According to Narayanan, ”portfolio expansion in fast-growing segments like Wet Cat Food” and expansion to tier 1 towns and e-commerce is playing a big role.

It has ”scope to unleash the full potential of business now”, he added.

Nestle SA owns 100 per cent of Purina Petcare India and 62.76 per cent of Nestle India.

Earlier in the day, Nestle India informed its board has approved the acquisition of Pet Foods Business from Purina Petcare India through a business transfer, with effect from October 1, 2022.

”The company and Nestle Group have agreed to a value of Rs 123.5 crore as the consideration for the purchase of PFB, which works out to around 3.4 times the turnover of Purina Petcare India for the financial year ended March 31, 2022,” Nestle India said in a filing.

In 2021-22, Purina Petcare India’s turnover was Rs 36.08 crore.

Besides, PFB would scale up its business from the wider distribution and supply chain network of Nestle India, which will effectively reach over 120 towns and accelerate organised trade, it added.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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