Nestle India, a fast-moving consumer goods (FMCG) major, said on Tuesday that India's sustained economic growth and rising consumption of packaged foods present a Rs 7,500 crore premiumization opportunity.

In a call with analysts, Suresh Narayanan, chairman and managing director, stated that premium products in each category have outpaced overall category growth, and that the trend is visible in both urban and rural markets.

Since 2015, the company's premium portfolio has grown at a CAGR of 16%.

It will increase market share by continuing to premiumise the core categories and products, he said.

Narayanan went on to say that the tax benefit announcements in the Union Budget will boost packaged food company sales and increase consumption in the country.

"While some money from the Rs 1 lakh crore will go towards savings and shedding the EMI burden, I hope part of it will come into consumption and give us a fillip," he told investors.

Narayanan, on the other hand, highlighted challenges such as rising food inflation and a slowdown in urban consumption, as well as a shift in consumption patterns such as increased health consciousness.

Commodities such as milk, coffee, and cocoa have experienced high levels of inflation, prompting the company to implement moderate price increases last year. Urban unemployment, slow real wage growth, and post-Covid moderation have all had an impact on demand in urban markets.

Narayanan added that the company will raise prices in certain categories, such as coffee.

The maker of Kitkat chocolate and Maggi noodles reported a 4.9% year-on-year increase in net profits to Rs 688 crore in the third quarter of FY25, as well as a 3.9% increase in net sales to Rs 4,779.7 crore from Rs 4,600.4 crore the previous year.