Nestle India's royalty payment to parent company jumps 14%
What's the story
Nestle India has reported a whopping 14.2% increase in its sales revenue for the fiscal year ending March 2026. The company's revenue surged to ₹23,071.46 crore during this period. In tandem with this growth, Nestle India also witnessed a rise in median employee remuneration by 7.3%. The company is also investing heavily in capacity expansion projects, including setting up its 10th factory in India.
Royalty increase
Royalty payments to parent company
Nestle India has paid a general license fee (royalty) of ₹1,024.5 crore to its Switzerland-based parent company, Societe des Produits Nestle S.A. This is a 13.91% increase from the previous fiscal year. The company also paid a withholding tax on general license fees amounting to ₹102.47 crore for FY26. In FY25, the company had paid ₹899.41 crore as general license fee and ₹89.71 crore as withholding tax on these fees.
Payment details
Nestle India pays a royalty of 4.5% net sales
Nestle India pays a royalty of 4.5% of its net sales to its parent company under General License Agreements. These agreements allow the Indian subsidiary to use the technology and intellectual property of the Nestle Group for manufacturing and marketing its products. As of March 31, 2026, promoter entities Nestle S.A. and Maggi Enterprises Ltd jointly hold a 62.76% stake in Nestle India.
Proposal rejection
Shareholders rejected proposal to increase royalty payment last year
Last year, Nestle India's shareholders had rejected a proposal to increase the royalty payment by 0.15% annually for five years, taking it up to 5.25% of net sales. The company had planned to implement this hike from July 1, 2024, but could not get the shareholders' approval. However, the latest annual report states that there were no material modifications in the terms and conditions of General License Agreements during FY26.
Business growth
Revenue and permanent employees in FY26
Nestle India's sales revenue for FY26 was ₹23,071.46 crore, a 14.2% increase from the previous fiscal year. The company owns popular brands such as Maggi, Nescafe, KitKat, MILKMAID and Cerelac among others. However, there was a slight decline in the total number of permanent employees at Nestle India to 8,382 in FY26 from 8,419 in FY25.