Tata Consumer Products Limited (TCPL) has announced its financial results for the first quarter, showcasing steady growth and strategic initiatives across its portfolio.

Revenue Growth and Performance Highlights

TCPL reported a consolidated revenue of Rs 4,779.00 crores for Q1, marking a 10% increase compared to the same period last year. The growth was primarily driven by:

• 11% growth in the India Business
• 6% growth in the International Business (in constant currency terms)
• 6% growth in the Non-Branded Business

The company's Group Consolidated Net Profit rose by 15% to Rs 332.00 crores, benefiting from improved performance of Associates and Joint Ventures.

Segment-wise Performance

India Business

The India business demonstrated strong momentum:

• India Packaged Beverages revenue grew by 12%
• Tata Sampann portfolio continued its strong performance, growing by 27%
• Value-added salt portfolio grew by 31%

International Business

The International business maintained its growth trajectory:

• 5% constant currency revenue growth
• Strong coffee performance in the USA, with Eight O'Clock coffee gaining market share

Non-Branded Business

The Non-Branded segment saw a 6% growth in constant currency terms. However, profits were impacted by reversals of fair value gains from the previous year due to easing coffee terminal prices.

Strategic Initiatives and Innovation

TCPL continued to focus on innovation and market expansion:

• Launched new products across categories, including Tetley Slim Care and Beauty Care green teas
• Strengthened omnichannel capabilities, with e-commerce growing 61% and modern trade recording 21% growth
• Expanded food services and pharmacy distribution to fuel growth

Tata Starbucks

The Tata Starbucks joint venture continued its expansion:

• Added 6 new stores during the quarter
• Total store count reached 485 across 80 cities
• Introduced new offerings like Cold Brew and 'Refreshers' to drive growth

Management Commentary

Sunil D'Souza, Managing Director & CEO of Tata Consumer Products, stated, "We delivered a steady topline growth of 10% in Q1, with double-digit net profit growth. During the quarter, we recorded double-digit growth in the core India business across both tea and salt backed by volume growth. Tata Sampann continued its strong trajectory, with new launches & innovations performing well."

Outlook

While the company faced some challenges, including tea cost inflation in India and coffee price corrections in the non-branded business, TCPL remains focused on delivering on its growth aspirations through ramping up advertising, innovation, and distribution expansion.

The company's continued focus on premiumization, omnichannel expansion, and innovation-led product launches positions it well for future growth in the competitive FMCG landscape.

Tata Consumer Products Limited (TCPL) has reported a robust performance for the first quarter, with consolidated revenue growing by 10% year-on-year to Rs 4,779.00 crores. The company's strong showing was primarily driven by double-digit growth in its core India business, particularly in the tea and salt segments.

Key Highlights

• Consolidated revenue grew 10% (9% in constant currency) to Rs 4,779.00 crores
• India business recorded 11% growth
• International business delivered 5% constant currency growth
• Group Net Profit increased by 15% to Rs 332.00 crores

Strong Performance in Core Segments

TCPL's India packaged beverages business saw a significant 12% revenue growth during the quarter. The company's salt portfolio continued its strong momentum, with revenue growing by 13% and volume increasing by 5%. Notably, the value-added salts segment experienced an impressive 31% growth.

Sunil D'Souza, Managing Director & CEO of Tata Consumer Products, commented on the results: "We delivered a steady topline growth of 10% in Q1, with double-digit net profit growth. During the quarter, we recorded double-digit growth in the core India business across both tea and salt backed by volume growth."

Tea Margin Recovery Expected

Despite the strong revenue growth in the branded tea business, margins declined by 10 percentage points as only 70% of cost inflation was passed to consumers. However, CEO Sunil D'Souza indicated that the company expects its branded tea margins to recover by the December quarter due to lower auction prices and improved cost pass-through. He anticipates one more quarter of margin pressure before returning to historical margins of 34-37%. Tea auction prices are currently 13% lower year-on-year, and the company expects price increases in mid to high single digits this year compared to 30% last year.

Coffee and Tata Sampann: Standout Performers

The company's coffee business demonstrated exceptional performance, registering a remarkable 67% revenue growth for the quarter. Tata Sampann, TCPL's pulses and spices brand, continued its strong trajectory with a 27% year-on-year growth.

International Business and Non-Branded Segment

The international business maintained its momentum with a 5% constant currency revenue growth, driven by strong coffee performance in the USA. The non-branded business grew by 6% in constant currency terms, adapting quickly to moderating coffee prices by optimizing sourcing strategies and managing inventory.

Challenges and Outlook

Despite the overall positive performance, TCPL faced some challenges. The Ready-to-Drink (RTD) business was impacted by unfavorable weather, recording only a moderate volume growth of 3%. The company also noted that operating performance was affected by tea cost inflation in India and coffee price corrections in the non-branded segment.

Innovation and Channel Expansion

TCPL continued to focus on innovation and expanding its distribution channels. The company strengthened its omnichannel capabilities, including food services and pharmacy channels. E-commerce and modern trade channels showed strong growth, with e-commerce growing by 61% and modern trade recording 21% growth in the quarter.

Tata Starbucks Expansion

Tata Starbucks, a joint venture between TCPL and Starbucks Corporation, added 6 new stores during the quarter, bringing the total number to 485 across 80 cities in India.

D'Souza concluded, "While transitory issues impacted growth in Capital Foods and Organic India, our focus now turns to delivering on our aspirations in these businesses through ramping up advertising, innovation and distribution expansion."

As Tata Consumer Products continues to navigate challenges and capitalize on growth opportunities, the company remains committed to strengthening its position in the FMCG sector through innovation, expansion, and strategic focus on its core segments.