Tata Consumer Products announces results for the quarter ended September 30, 2022

Consolidated results:

• Revenue from operations for the quarter at Rs3,363 crore up 11 percent. For six months ended, Revenue at Rs6,690 crore up 11 percent.  
• Consolidated EBITDA for the quarter at Rs438 crore, grew 4 percent and for six months ended EBITDA at Rs897 crore  grew 9 percent.
• Group net profit for the quarter at Rs389 crore grew 36 percent, group net profit for six months at Rs666 crore grew by 37 percent.

Tata Consumer Products today announced its results for the quarter ended September 30, 2022. For the quarter, revenue from operations increased by 11 percent (10 percent in constant currency) as compared to the corresponding quarter of the previous year. Profit before exceptional items and tax at Rs370 crore is 2 percent  higher reflecting the impact of inflationary pressures, weakness in currency and some lag in pricing in the international business. Group consolidated net profit at Rs389 crore is higher by 36 percent.

Some of the key business updates are:

India

• For the quarter, the India Packaged Beverages business recorded 7 percent revenue decline due to pricing corrections and overall softness in the category. We continued to record volume market share gains in branded tea.  
• Coffee continued its strong performance with a revenue growth of 39 percent  during the quarter.
• We continued the momentum on innovation with the launch of Tata Tea Gold Saffron – signature Assam tea with natural saffron flavour, and the launch of a new season range for Sonnets by Tata Coffee – our premium coffee range.
• We continued to drive premiumisation, as the premium tea portfolio continued to grow faster than the base portfolio.
• Tata Tea Premium celebrated 75 years of India’s Independence with a special collection of tin cans, teacups, and plates commemorating great moments of pride from India’s post-independence history.
• Tata Tea Gold launched its festive edition series celebrating the various art forms of West Bengal, bringing alive the joy of Durga Puja. Chakra Gold Tea launched an exclusive campaign in Andhra Pradesh and Telangana during Navratri supporting Kondapalli toys, an art form with a rich tradition in these states. Tata Tea Kanan Devan recorded its highest-ever volumes in Kerala led by on-ground activations during Onam.
• For the quarter, the India Foods business registered 29 percent revenue growth despite an elevated base that saw 23 percent growth in the same period last year.
• The salt portfolio continued its momentum and recorded double-digit revenue growth during the quarter despite a high base in Q2 last year. The salt portfolio also continued to record market share gains.
• Tata Salt Immuno was launched with new and improved packaging to better showcase the zinc proposition. The brand was successfully launched in newer markets in the western part of the country.
• The Tata Sampann portfolio recorded strong double-digit growth led by broad based performance across pulses, poha and spices.
• Tata Sampann launched a new campaign with Manoj Bajpayee to build awareness about the goodness of unpolished pulses and the promise of Tata Sampann.
• Tata Sampann spices launched a customised mix for Andhra Pradesh and Telangana to better serve the south Indian market. The spices range expanded its portfolio in India into high-value spices with the launch of asafoetida (hing).
• Tata Sampann Dry Fruits is scaling up well with strong growth and share gains across e-commerce platforms.
• Tata Consumer Products launched another addition to its protein platform with the launch of Tata GoFit – plant protein powder, a health supplement range for women who are on their journey to be fitter every day. Tata GoFit has been specially developed for women and has an innovative and differentiated formulation with digestion-friendly enzymes and gut-friendly probiotics.
• We relaunched our Ready-To-Eat (RTE) business (formerly Tata Q) under the new brand name of Tata Sampann Yumside with a revamped and expanded portfolio. This includes reformulation of existing products to enhance overall consumer experience and expansion into the ethnic RTE category. The brand will also be launching ethnic innovations in the Ready-to-Cook (RTC) category.
• Tata Soulfull delivered strong growth during the quarter. Tata Soulfull Masala Oats+, a ‘better for you’ offering with oats and millets, saw good consumer response across key channels. A new enhanced Tata Soulfull millets muesli with 25 percent millets was launched to further strengthen the health proposition and provide a better crunchier taste experience to consumers.
• NourishCo sustained strong growth momentum during the quarter with a 63 percent revenue growth led by growth across products and geographies. Himalayan recorded excellent growth and continued to remain EBIT positive during the quarter. Himalayan honey and preserves saw good consumer response. The Himalayan brand celebrated ‘Himalayan Day’ by partnering with Ladakh marathon for the world’s highest ultra-marathon ‘Himalayan Khardungla Challenge 2022’ with the objective of giving back to its source and supporting the cause of protecting local communities affected by melting Himalayan glaciers in the Ladakh region. 
• We reached new milestones in our sales and distribution transformation agenda. Our direct reach is now 1.4 million outlets and the number of our super stockists has grown by 20 percent.
• We continued to see strong growth in alternate channels, with Modern Trade Channel growing 18 percent YoY. The e-commerce channel grew 40 percent contributing to 9.2 percent of India business sales. Additionally, alternate channels continued to support the innovation agenda with 11 percent of e-commerce revenue coming from NPD (New Product Development) sales during the quarter.

International

• For the quarter, the international beverages business revenue grew 7 percent.
• In the UK, TCPL became the third largest branded tea company by market share, displacing Twinnings.
• Teapigs in UK launched an iced tea range supported with ‘Summer of teapigs’ campaign across print and digital platforms.
• Eight O’ Clock (EOC) coffee in the USA recorded share gains, with EOC K cups growing ahead of the category.   
• The newly launched Tetley Sweet Tea Cold Brew strengthened our presence in the specialty tea segment in the USA. Tetley Irish Breakfast tea continued to do well led by distribution gains and ongoing promotion activity.
• In Canada, launched a new range of teas under Tetley Live teas. The range features three variants – Live Cool (peppermint spearmint), Live Bold (cinnamon chai rooibos) and Live Calm (camomile, spearmint, orange)

Tata Starbucks

• Tata Starbucks recorded strong revenue growth of 57 percent for the quarter, led by normalised store operations and a revival in out of home consumption.
• Started its 10th anniversary celebration with ‘Brew your own Starbucks’ campaign giving customers a chance to create beverages to be featured on the menu.
• Opened 25 new stores during Q2, the highest ever number of quarterly store openings in its history and entered five new cities. This brought the total number of stores to 300 across 36 cities.

Awards update

• Tata Consumer Products has been ranked in Kantar India as Brand Footprint Report 2022 as the ‘5th Most Chosen FMCG Brand in India’.
• Tata Tea was awarded as the ‘Most Purposeful FMCG brand’ in India by Kantar Brandz 2022 Most Valuable Indian Brands.
• Tata Tea Chakra Gold won the ‘Brand of the Year’ at Exchange4media’s Indian Marketing Awards South 2022.
• Tata Consumer Soulfull emerged as the winner of exchange4media D2C award at the e4m D2C Revolution Awards 2022.
• Tata Consumer Products’ beverages packeting centres in Gopalpur and Kellyden won Silver in the India Green Manufacturing Challenge 2021-22 by the International Research Institute for Manufacturing.
• Tata Consumer Products won Gold for the ‘Best Business/ Financial Content’ (Print) at the India Content Leadership Awards and Conference 2022 by Inkspell and India Creative Industries Council.  

Sunil D’Souza, MD and CEO of Tata Consumer Products, said, “We delivered another quarter of double-digit revenue growth while balancing margins despite inflationary pressures, weakness of currency and some lag in pricing in international markets. While the branded tea category in India is tepid, we continued to gain volume market share. In our other core business of salt, despite significant inflation-led pricing, we have continued to gain market share and strengthen our leadership position. We have accelerated the pace of innovation this year with the number of new launches being twice as much as the same period last year. Our new engines of growth — Tata Sampann, NourishCo, Tata Soulfull — have delivered significant growth and are expanding their portfolio and reach. Our out of home businesses — NourishCo and Tata Starbucks — have recorded strong growth during the quarter.

“While unprecedented inflation and adverse currency movements in our international business have weighed on our margin this quarter, we will be driving structural cost-saving initiatives to improve the trajectory going forward. Our transformation agenda to become a leading FMCG company continues to be on track. We are making consistent progress in expanding our reach across channels, strengthening our innovation capabilities, and embedding digital transformation across the organisation. We will continue to stay focused on growth while fuelling our new businesses.”