Nestle India's Royalty Payment To Parent Firm Crosses ₹1,000 Cr In FY26

Nestle India paid more than ₹1,000 crore in royalty and licence fees to its Switzerland-based parent entity during FY26, according to the company's latest annual report.

The FMCG major paid ₹1,024.5 crore as general licence fees to Société des Produits Nestlé S.A. during the financial year ended March 2026, up 13.91% from ₹899.41 crore paid in FY25.

In addition, Nestle India paid ₹102.47 crore as withholding tax on the licence fees during FY26, compared with ₹89.71 crore in the previous fiscal.

Royalty Linked To Sales

Nestle India pays royalty to its parent company for access to the Nestlé Group's technology, intellectual property, product formulations and manufacturing know-how.

The company currently pays royalty equivalent to 4.5% of net sales under its General Licence Agreements.

According to the annual report, there were no material modifications to the terms and conditions of these agreements during FY26.

"During the financial year ended 31st March 2026, there was no material modification in the terms and conditions of General Licence Agreements, as defined by the Audit Committee and specified in the RPT Policy," the company said.

The disclosures come nearly two years after shareholders rejected a proposal to gradually increase royalty payments to the parent company.

Last year, investors voted against a plan that sought to raise royalty payments by 0.15 percentage points annually over five years, which would have increased the royalty rate from 4.5% to 5.25% of net sales.

Revenue Crosses ₹23,000 Cr

The increase in royalty payments coincided with higher revenue growth during the year. Nestle India's revenue from sales rose 14.2% to ₹23,071.46 crore in FY26.

The company owns several leading consumer brands, including Maggi, Nescafé, KitKat, Milkmaid and Cerelac.

Nestlé S.A. and Maggi Enterprises Ltd, the promoter entities of the company, together held a 62.76% stake in Nestle India as of March 31, 2026.

Workforce And Pay Trends

The annual report also showed a marginal decline in the company's permanent workforce. Nestle India had 8,382 permanent employees at the end of FY26, compared with 8,419 in FY25.

The company is currently investing in capacity expansion and is setting up its tenth manufacturing facility in India. Employee compensation, however, continued to rise. The median remuneration of employees increased by 7.3% during FY26, compared with a 4.9% increase in FY25.

The remuneration ratio between Chairman and Managing Director Manish Tiwary and the median employee stood at 134:1. Tiwary took over as Chairman and Managing Director on August 1, 2025.