Nestlé India Shares Climb as LIC Increases Stake Beyond 5% Threshold

Mumbai, 27 May 2025: On Monday, 26 May 2025, shares of Nestlé India advanced over 2% in intraday trading after the Life Insurance Corporation of India (LIC) raised its stake in the packaged foods giant. LIC’s latest market purchase pushed its total shareholding to 5.001%, surpassing the mandatory disclosure threshold under regulatory norms, and reigniting investor interest despite a recent mixed quarterly performance.

LIC Breaches Regulatory Threshold

As per a regulatory filing made under SEBI’s Substantial Acquisition of Shares and Takeovers (SAST) Regulations, LIC acquired an additional 1,49,000 equity shares of Nestlé India on 23 May 2025. This increased its total holding to 4,82,24,710 shares equivalent to 5.001% of the company’s paid-up equity.

Previously, LIC held 4,80,75,710 shares or 4.986% of Nestlé India’s equity. The total share capital of the company remains unchanged at ₹96.41 crore.

Market Response and Stock Movement

Following the stake acquisition, Nestlé India’s share price rose to a session high of ₹2,464.50, registering a gain of 2.1%. However, the stock remains approximately 11% below its 52-week peak of ₹2,777, recorded in September 2024. In contrast, its 52-week low stood at ₹2,115 in March 2025.

The stock has experienced volatility in recent months. While it declined 5.3% in February 2025, it recovered with gains of 6.6% in January, 2.8% in March, and 6% in April. In May so far, it has gained another 2.6%, though it remains around 2% lower over the past year.

Nestlé SA Eyes Indian Pet Care Market

In parallel developments, Nestlé SA, the parent company of Nestlé India, made a minority investment in Drools Pet Food Private Limited. Though financial details remain undisclosed, the investment follows Drools’ $60 million funding round in 2023, which saw participation from LVMH-backed private equity firm L Catterton. Drools will continue to operate independently.

Quarterly Results and Dividend

For Q4 FY25, Nestlé India posted a standalone net profit of ₹885 crore, marking a 5.2% year-on-year decline. Revenue rose 4.5% to ₹5,504 crore, marginally ahead of expectations. EBITDA grew 3.9% to ₹1,389 crore, with an EBITDA margin of 25.2%, slightly down 20 basis points year-on-year. High cocoa prices exerted pressure on margins. The company announced a final dividend of ₹10 per share for FY25.

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