Nestlé India has doubled its sales over the last 4 years through strategies focused on increasing penetration, frequency of purchases, and new product development. It has the number one market position in several categories in India. To continue winning in the new reality of high inflation and commodity costs, Nestlé India is focusing on a multi-tier portfolio, driving nutrition, health and wellness, expanding distribution, and engaging consumers. It also aims to create shared value through various rural development programs. Nestlé India has achieved strong financial performance with earnings per share growing 5.5 times over the past decade.

1. Nestlé in India:
Winning in the
New Reality
Helio Waszyk
Chairman and Managing Director
Nestlé India
Nestlé Investor Seminar, Shanghai
September 25th, 2012

2. Agenda
1. Introducing Nestlé India
2. Winning in The New Reality
3. Performance
2 September 25th, 2012 Nestlé Investor Seminar, Shanghai

3. South Asia is a large, Diverse and Complex Region
INDIA NEPAL
Population: 1210 million Population: 30 million
GDP 1,800 US$ bn GDP 19 US$ bn BHUTAN
GDP 1,522 US$ p.c. GDP 622 US$ p.c.
Population: 1 million
GDP 1 US$ bn
GDP 2076 US$ p.c.
SAR
Population: 1.42 bn
20% of world population
(33% of world poor) BANGLADESH
Area: 3.7 million km2
Literacy 74% Population: 161 million
GDP 113 US$ bn
Rural 73% GDP 701 US$ p.c.
GDP 1990 US$ bn
2% of world GDP
GDP 1400 US$ p.c.
MALDIVES SRI LANKA
Population: 0.4 million Population: 21 million
GDP 2 US$ bn GDP 59 US$ bn
GDP 4928 US$ p.c. GDP 2751 US$ p.c.
• Huge diversity (Literacy, Urbanization, Wealth, Climate, Languages….)
• Growth driven market but volatility & macro-economic concerns recently
• India accounts for 85% of South Asia’s Population
3 September 25th, 2012 Nestlé Investor Seminar, Shanghai

4. Nestlé India part of India Inc.
• Nestlé India is a public listed company
• Nestlé SA holds 62.76% share
• Market Capitalization INR 402 bn
(7.1 bn CHF)
Market Capitalization end 2011
Exchange rate end 2011: 1 CHF = INR 56.70
4 September 25th, 2012 Nestlé Investor Seminar, Shanghai

5. Balanced Portfolio with Leading Brands
Milk Products Prepared Dishes
2011 Nestlé India: & Nutrition & Cooking Aids
Sales of INR 74.9 bn*
8% of Zone AOA Sales 45% 29%
13%
13%
Chocolate Beverages
& Confectionery
*Exchange rate (Avg.2011): 1 CHF = INR 52.59
5 September 25th, 2012 Nestlé Investor Seminar, Shanghai

6. The Multi-faceted Opportunity & Demographic Dividend
Young Population an Asset Urban-Rural Tiers
• 54% population below • 69% population is Rural
24 years • 53 cities with 1 million+,
• Net growth +1.3% p.a. 8 cities with 5 million+
population
Increasing Awareness & Digitalization GDP Growth and the New Reality
GDP per capita $1500+
• 900 million mobiles Consumer Confidence Index 119 (-4)
• 84% reach of TV in Urban 9.5 8.5
7.4 7.7
• 125 million internet users 7.1
5.4
%
2007 2008 2009 2010 2011 YTD 2012
6 September 25th, 2012 Nestlé Investor Seminar, Shanghai

7. The New Reality
Inflation, rising commodity costs & weakened Rupee
Inflation Trends Nestlé India Commodity Basket USD : INR
(Price Index) Average Exchange Rate
148
17.7
138 52.3
7.3%
12.7
12.0 123
48.4
9.5 12.1%
10.9 9.6 9.1 9.5 112
9.3 8.7 110 46.6
8.4 8.9 8.3
10.4%
7.3 7.4 1.6%
6.4 45.7
43.6
100
4.9 10%
41.3
2.4
Closing Exchange Rate at 30/Jun/2012 1USD = 56.21 INR
2007 2008 2009 2010 2011 H1 2007 2008 2009 2010 2011 H1 2007 2008 2009 2010 2011 H1
2012 2012 2012
Inflation (WPI) Inflation (Food)
7 September 25th, 2012 Nestlé Investor Seminar, Shanghai

8. The Multi-tier Income Pyramid offers scope across
Premium, Mainstream, PPP
Population distribution Income distribution
2005 2015 2005 2015
Global India
CONSUMER BASE
Seeking & Striving
India
Aspiring India
Deprived India
Source: NCAER, Projections
Income pyramid will move from a triangle to a diamond…
…generating additional genuine inclusive growth…
…equally distributed across income tiers
8 September 25th, 2012 Nestlé Investor Seminar, Shanghai

9. The Double Burden
Micronutrient deficiencies and health issues
Micronutrient deficiencies
Overweight Iron
• 60 million overweight/ obese (BMI>25) • 60 million children under 3 years
• 90 million urban Women
Diabetes Vitamin A
• From 50 million to 80 million diabetics • 95 million children under 6 years
in India by 2030
Heart health Iodine
• 30 million Coronary Heart Disease • 7 million children born p.a.
• 120 million hypertension, 60% of cardiac unprotected from mental impairment
patients in the world are Indians
Health issues
9 September 25th, 2012 Nestlé Investor Seminar, Shanghai

10. Agenda
1. Introducing Nestlé India
2. Winning in The New Reality
3. Performance
10 September 25th, 2012 Nestlé Investor Seminar, Shanghai

11. The Nestlé Strategic Roadmap to
Win in The New Reality
11 September 25th, 2012 Nestlé Investor Seminar, Shanghai

12. Our Overall Strategy
SOURCES OF SALES GROWTH
OUR STRATEGY
> We will
accelerate
penetration AND
increase
frequency AND
develop winning
concepts
> We will focus on
both growth AND
margins
NEW PRODUCTS &
PENETRATION FREQUENCY
BUSINESS
(sell same (sell more
(sell new to same
to new) to same)
& sell new to new)
* does not include new opportunities
12 September 25th, 2012 Nestlé Investor Seminar, Shanghai

13. Emerging
Value Creation with a Multi-tier portfolio markets and
Popularly Premiumisation
Positioned
Products
Premium
Mainstream
PPP
13 September 25th, 2012 Nestlé Investor Seminar, Shanghai

14. Driving Nutrition, Health and Wellness Nutrition
Health and
Wellness
Engagement with Consumers
14 September 25th, 2012 Nestlé Investor Seminar, Shanghai

15. Out of Home Opportunities abound Out-of-home
consumption
Driving Vending NESCAFE Corners
Building Food Channels
15 September 25th, 2012 Nestlé Investor Seminar, Shanghai

16. Winning with Distribution and Route to Market Whenever,
wherever,
however
Distribution Reach - Million Outlets General Trade & Organized Trade
3.7
+490K
3.2
+380K
2.8
+290K
2.5
2008 2009 2010 2011
16 September 25th, 2012 Nestlé Investor Seminar, Shanghai

17. Milk Products & Nutrition Innovation
& renovation
Consumer
communication
Enhancing the Quality of life and Delighting consumers, building on the
goodness of milk
Market Position Enhancing the Quality of life
• No. 1 in Dairy Whitener
• No. 1 in Baby Food
• No. 1 in Infant Formula
Tea Creaming Delighting consumers Health Care Nutrition
Maternal Nutrition
17 September 25th, 2012 Nestlé Investor Seminar, Shanghai

18. Prepared Dishes & Cooking Aids Innovation
& renovation
Consumer
communication
Tasty & Balanced food everyday
Market Position Noodles/ Light Meals
• No. 1 in Instant Noodles, Sauces & Pasta Fortification/ Goodness of grains
• No. 2 in Soups
Retail and Brand Activation Among Top 10 Most Trusted Brands in India
Source: Economic Times, 2011
18 September 25th, 2012 Nestlé Investor Seminar, Shanghai

19. 19 September 25th, 2012 Nestlé Investor Seminar, Shanghai

20. Beverages Innovation
& renovation
Consumer
communication
Value Leadership in Instant Coffee & Building the new category of Iced Tea
Market Position Driving NESCAFÉ
• No. 1 in Instant Coffee
• Strong presence in Vending
• Leading Iced Tea Innovation
1.5 Million NESCAFÉ Facebook Fans Building a new category
20 September 25th, 2012 Nestlé Investor Seminar, Shanghai

21. Confectionery Innovation Consumer
Delight in every bite – meeting consumer needs for pleasure
& renovation communication
Market Position Winning at point of purchase
• No. 1 in Wafers & Whites
Innovation Impactful Communication
21 September 25th, 2012 Nestlé Investor Seminar, Shanghai

22. KITKAT ad – Squirrel
22 September 25th, 2012 Nestlé Investor Seminar, Shanghai

23. Global R&D center in India strategically placed to Unmatched
research &
development
leverage local insight and global technology capability
Popularly Positioned Products Indian Cuisine Mastership
Noodle Technology Localized Cereals/ Chocolates
23 September 25th, 2012 Nestlé Investor Seminar, Shanghai

24. Goal Alignment and People Engagement People,
culture,
values &
attitude
• Goal Alignment and People Engagement
• Instill the “Desire to Win”
• Healthy Industrial Relations
• War for Talent
• Leadership Development 6960
6630
5570
4980
Dec-09 Dec-10 Dec-11 Jun-12
No. of Employees
24 September 25th, 2012 Nestlé Investor Seminar, Shanghai

25. Developing Moga milk district
• Nestlé quality collection centers
• Milk Chillers installed at the villages
• Transparency in rates
• Regular payments to ~50,000 farmers
• Better quality & better price for both the farmer &
Nestlé
1+ million liters/day !
Win Win Model !
25 September 25th, 2012 Nestlé Investor Seminar, Shanghai

26. Creating Shared Value
Nutrition Water Rural Development
Nestlé Healthy Kids Programme Clean Drinking Water Projects Milk Farmers
• In collaboration with Universities • Technical assistance and training to farmers
• Access to clean drinking water in village schools
• Village Women Dairy Development Programme
across SAR factories
Nestlé Healthy Kids for Delhi Water Awareness Programme Chicory farmers
• Creating awareness among village school students • Training, Improve chicory quality and productivity
Health Camp: Micronutrient awareness
• In collaboration with Drishtee Foundation International Water management Institute The NESCAFÉ Plan
• Study on the water footprint of Milk, rice and wheat • Launched on 5th Jan 2012
in the Moga region
• Water Awareness Programme for milk farmers Sanitation facilities
• Sanitation projects benefitting girl students
26 September 25th, 2012 Nestlé Investor Seminar, Shanghai

27. Agenda
1. Introducing Nestlé India
2. Winning in The New Reality
3. Performance
27 September 25th, 2012 Nestlé Investor Seminar, Shanghai

28. Nestlé India doubled sales in the last 4 years
Sales Growth - India
Index
2011 Sales= INR 74.9 bn
CAGR 2007-2011= 20.9%
• Doubled sales in the last 4 years
214
• Operating Profit 18.5% in 2011
178
• ROIC 50% in 2011
146
• 500 million CHF Capex in 2010-12
123
100 • Healthy working capital 4.7% in 2011
Exchange Rate (Avg 2011) 1CHF= 52.59 INR
2007 2008 2009 2010 2011
28 September 25th, 2012 Nestlé Investor Seminar, Shanghai

29. Low & further improving operating working capital
2007 2008 2009 2010 2011
TNWC as % of sales (indexed 2007 = 100)
Basis Nestlé Internal Reporting Standards
29 September 25th, 2012 Nestlé Investor Seminar, Shanghai

30. Nestlé India earnings per share multiplied 5.5 times in
10 years
Nestlé India EPS Nestlé India Share Price Movement
2001 X 1.8 2006 X 3.0 2011
INR per Share
5'000
X 5.5 99.7
84.9
4'000
67.9
EPS (INR)
55.4 3'000
42.9
32.7 2'000
32.1
27.3 26.1
18 20.9
1'000
-
Year
2002
2001
2003
2004
2005
2006
2007
2008
2009
2010
2011
2007 2008 2009 2010 2011
Nestlé India Share Price CAGR 38%
CAGR 18.7%
(BSE SENSEX CAGR 4%)
30 September 25th, 2012 Nestlé Investor Seminar, Shanghai

31. Nestlé India ranks among the top companies in India
Dun & Bradstreet Business Insight 2011
Total Income Net Profit Market Cap RONW
Rank among Top 500
companies 97 90 43 1
across industries
RONW: Return on Net Worth or Return on average equity is computed as follows
NET PROFIT FOR THE YEAR / AVERAGE OF OPENING AND CLOSING SHAREHOLDER FUNDS FOR THE YEAR
31 September 25th, 2012 Nestlé Investor Seminar, Shanghai

32. Nestlé India continues to unlock opportunities and
invest for the future
• Strong profitable growth
• Taking into account the new reality
• Investing for the future
• Well poised to capture the opportunities
32 September 25th, 2012 Nestlé Investor Seminar, Shanghai