Company Information: Nestle

Nestl with headquarters in Vevey, Switzerland was founded in 1866 by Henri Nestl and is today the world's biggest food and beverage company. Sales for 2006 were CHF 109.5 bn, with a net profit of CHF 18.7 bn. The company employs around 283,000 people and has factories or operations in almost every country in the world. Nestl India is a subsidiary of Nestl S.A. of Switzerland having 4300 Cr. turnover. With seven factories and a large number of co-packers, Nestl India is a vibrant Company that provides consumers in India with products of global standards and is committed to long-term sustainable growth and shareholder satisfaction. The Company insists on honesty, integrity and fairness in all aspects of its business and expects the same in its relationships. This has earned it the trust and respect of every strata of society that it comes in contact with and is acknowledged amongst India's 'Most Respected Companies' and amongst the 'Top Wealth Creators of India'. Nestls relationship with India dates back to 1912, when it began trading as The Nestl AngloSwiss Condensed Milk Company (Export) Limited, importing and selling finished products in the Indian market. Nestl has been a partner in India's growth for over nine decades now and has built a very special relationship of trust and commitment with the people of India. The Company's activities in India have facilitated direct and indirect employment and provides livelihood to about one million people including farmers, suppliers of packaging materials, services and other goods. The Company continuously focuses its efforts to better understand the changing lifestyles of India and anticipate consumer needs in order to provide Taste, Nutrition, Health and Wellness through its product offerings. The culture of innovation and renovation within the Company and access to the Nestle Operates in following business domains in India: Milk Products & Nutrition- 44% of Sales Beverages-21% of Sales Prepared Dishes & Cooking Aids-20% of Sales Chocolates & Confectionery-15% of Sales Milk Products & Nutrition: India's organized milk and milk products industry is growing at a growth rate of nearly 30% and expected to become $ 2.4 billion industry by 2010. Nestle is a dominant player in this sector only behind Amul.

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Brands NESTL EVERYDAY Dairy NESTL EVERYDAY Ghee NESTL Fresh 'n' Natural Dahi NESTL NESVITA Fruit Yoghurt NESTL EVERYDAY Slim NESTL Fresh 'n' Natural Slim Dahi NESTL MILKMAID NESTL Milk NESTL Jeera Raita NESTL MILKMAID FUNSHAKES NESTL NIDO NESTL CEREVITA NESTL NESVITA Major Competitors - Amul, Britannia Beverages: Nestle is market leader in this segment with 55% market share closely followed by HULs Bru. Brands Nescafe Classic Nescafe Sunrise Nestle Milo Nescafe Milds Major Competitors HUL(Bru) Prepared Dishes & Cooking Aids: Nestle has strong presence in category with following product line. Maggi is the market leader in Instant noodles category. Brands MAGGI 2-MINUTE Noodles MAGGI Vegetable Atta Noodles MAGGI Dal Atta Noodles MAGGI Rice Noodles Mania MAGGI Sauces MAGGI Healthy Soups MAGGI MAGIC Cubes MAGGI Healthy Soup- Sanjeevni Major Competitors Top Ramon, HUL(Knorr soup), ITC, Nissin, Bambino

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Chocolates & Confectionery: The 1500 Cr. chocolate market is led by Cadbury with 70% market share. Nestle is at the second place followed by Amul. Brands NESTL KIT KAT NESTL KIT KAT LITE NESTL MUNCH NESTL MUNCH POP CHOC NESTL MILKYBAR NESTL MILKYBAR CHOO NESTL BAR-ONE NESTL FUNBAR NESTL Milk Chocolate NESTL Eclairs POLO NESTL TANG EEZ Major Competitors Cadbury, Hershey, Parle, Wrigley, Perfetti SWOT Analysis Strengths Access to Nestl's Proprietary technology brands and expertise Strong & well differentiated brands with leading market share. Ongoing product innovation and renovation to convert consumer insights. Distribution structure that allows Threats Competitive environment with diverse players. Rising prices of commodities. Weakness Opportunities

Ability to pass Potential for expansion through cost in the smaller towns increases in and other geographies. price points SKU Exports of coffee to Russia constitute significant part of overall exports. Complex supply chain configuration. Development of modern retail formats. Potential for growth through increased penetration. Growing trend for Out of Home consumption. Leverage Nestl Technology to develop more products that provide Nutrition, Health and Wellness. Growing per capita income.

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Potential product launches in near future Milk Products - Carnation Prepared dishes - Buitoni, Lean Cuisine, Hot Pockets, Stouffer's Baby Food Nestle - NAN Beverages - Nesquik, Nespresso Ice Cream - Dreyer's, Edys

Latest Global Happenings Nestl Confectionerys price-marked packs Nestl Confectionery is set to boost sales of many of its leading impulse lines by launching new price marked packs for a limited period. Retailers are now able to stock up on 29p price marked packs of SMARTIES Hexatube, MILKYBAR Medium, MILKYBAR Buttons and ROWNTREE'S Fruit Pastilles. Following that, from 28th September, kids' lines of AERO Mint Medium, YORKIE Milk Original and KIT KAT SENSES will be in available in 35p priced mark packs. Packs and outers will display the offering with a 35p or 29p flash, ensuring the price is clearly communicated. As part of the activity, retailers will also benefit from receiving two free packs per standard outer to sell in store. Graham Walker, Nestl UK Trade Communications Manager, says; "In the current economic climate retailers are looking to pass savings onto the consumer. "The new Nestl Confectionery promotion offers exactly this - shoppers save 10 - 14p off standard RRPs, retailers will benefit from increased volume sales and 2 free packs per outer." Recent research from him! which spoke to almost 3,500 independent retailers, supports this view. In regards to promotional activity, 34% of independent retailers say they're shopping around for the best deals and one third of retailers say they're now offering more promotions in store, such as price marked packs. This recent promotion from Nestle Confectionery follows on from price marked pack promotions in March across MILKYBAR, SMARTIES and ROWNTREE'S impulse lines. The promotion was incredibly successful, with rate of sale increasing by up to 30%. Weight Watchers sues Nestle for misusing its logo Weight Watchers International Inc on Wednesday sued Nestle AG, accusing the Swiss-based food company of illegally using its name to promote low-fat frozen dinners and ice cream. According to a lawsuit filed in Manhattan federal court, Nestle is without permission displaying trademarks for Weight Watchers and its "Points" weight loss system on packaging for its Stouffer's Lean Cuisine products, including frozen pizzas and flatbreads, and its Skinny Cow diet ice cream products. Weight Watchers said the displays are intended to take advantage of its "goodwill and high reputation among consumers" in the field of weight control, which the New York-based company said it has "painstakingly built" over 46 years. It also said the displays could confuse consumers into believing Weight Watchers produced or endorsed consumption of Nestle products, some of which compete with its own.

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Though well-known for chocolate products, Nestle is also the parent of Jenny Craig Inc, a major Weight Watchers rival. Nestle bought Jenny Craig in 2006 for about $600 million. Nestle did not immediately return calls seeking comment. The company has U.S. operations in Glendale, California. Weight Watchers is seeking remedies including restitution of improper profits, triple damages, punitive damages, and a halt to misuse of the trademarks. Shares of Weight Watchers closed Wednesday up 28 cents, or 1.1 percent, at $26.29 on the New York Stock Exchange. The case is Weight Watchers International Inc v. Nestle USA Inc, U.S. District Court, Southern District of New York (Manhattan), No. 09-7964. (Additional reporting by Aarthi Sivaraman in Seattle; Editing by Gary Hill) Nestle warns of possible exit from Switzerland The world's biggest food company Nestle could leave its homebase Switzerland if Bern imposes a cap on executives' salaries, the group's chairman said in remarks published on Sunday. "It would be the beginning of an end," Peter Brabeck told Swiss newspaper Sonntag, in reply to a question about calls for the federal government to impose salary ceilings. Asked what kind of consequences such a move might have on Nestle, a national corporate icon, Brabeck replied: "Then we must ask ourselves whether Switzerland is still the right location for us." The global financial and economic crisis has prompted mounting public anger against high pay and bonuses drawn by executives, particularly those who work in the finance industry. In recent weeks, politicians from some industralised economies have been pushing for caps on wages. For Brabeck, Switzerland's most attractive characteristic has been the "legal certainty" that it offers. However, he said that this certainty, which was "like a granite block, has been dampened." "Recently, there has been external pressure on Switzerland and populist pressure from within. There we've seen that the government and parliament was rather quickly prepared to amend existing laws. "That is damaging for a location. Switzerland was once known for not ceding to such demands." In a landmark out-of-court settlement with US authorities, major Swiss bank UBS agreed to reveal the identities of 4,450 American clients. For some, this meant that Switzerland's strict banking secrecy rules had been compromised. Brabeck said the UBS case was not isolated, and cited pressure from the German Finance Minister Piers Steinbrueck on Swiss banking secrecy rules as another example. "For Switzerland as a location, it is important that legal certainty stays -- it must in part even be rebuilt," Brabecks said. Headquartered in Vevey, in the west of Switzerland, Nestle last year posted net profits amounting to 18 billion Swiss francs (17.3 billion dollars, 11.9 billion euros). Nestle sees slightly faster recovery Nestle chief executive Paul Bulcke expects the global economy to recover a little faster then first thought, helping to boost sales growth at the world's biggest food group, especially in late 2009. The Swiss maker of Nespresso coffee, Carnation milk and Maggi sauces sees the pickup coming from its nutrition and developing world businesses as it invests heavily in brand marketing ahead of the anticipated upturn.

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Belgium-born Bulcke said the group had a variety of options in mind for the cash from the likely $28 billion sale of its 52 percent stake in U.S. eyecare group Alcon, but appeared to rule out a counterbid for Cadbury by sticking to its plans for no major acquisitions in 2009 and 2010. "You read about these green shoots and then you read that these shoots don't blossom, but I do believe we're going to come out of this a little bit faster than we thought," Bulcke told Reuters at the opening of a new research center for luxury chocolate in the Swiss town of Broc. H2 SEEN STRONGER "The developing world and emerging markets in general are showing nice signs of (reviving)... Europe is going to take a little bit longer." Nestle shares were up 0.3 percent at 1500 GMT on a day when most European food shares rose on Kraft's bid for Cadbury. Bulcke was happy with analysts' forecasts for underlying 2009 sales growth of 4.1 percent, up from a lower-thanexpected 3.5 percent in the first half. "(We feel) the latter part of the year is going to give us an easier comparison," he added, referring to the slower growth rate posted in the fourth quarter of 2008. The maker of Kitkat chocolate bars and Haagen-Dazs ice cream had trimmed its target for 2009 underlying sales growth to around 4.1 percent from "at least approaching 5 percent." NO CADBURY COUNTERBID? Bulcke declined comment on whether Nestle might counterbid for Cadbury after the British confectionery group rejected a 10.2 billion pound offer from U.S.-based Kraft, but he reiterated that it planned no big acquisitions. "We are always open for opportunities, but we have no plans for any major acquisitions in 2009 and 2010," he said. Bulcke also repeated Nestle's guidance for raw material prices to rise 2 percent this year, with commodity price rises in general slowing. But volatility might increase, with prices rising again in the longer term, particularly for milk, "so growth is going to come in more dynamically from volume growth."

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