Tata Consumer Products Limited (TCPL) has delivered a robust performance in the second quarter, with significant growth across its business segments. The company's consolidated revenue from operations grew by 18% year-on-year to ₹4,966 crores, driven by strong performances in both its branded and non-branded businesses.

Key Highlights

• Consolidated revenue grew 18% (16% in constant currency terms) to ₹4,966 crores
• India business grew 18%, with the core business recording double-digit growth in both tea and salt
• International business delivered 9% constant currency growth
• Non-branded business grew 26% in constant currency terms
• Consolidated EBITDA stood at ₹675 crores, up 7% YoY
• Group Net Profit increased by 11% to ₹407 crores

Segment Performance

India Business

The India packaged beverages business revenue grew by 12%, with coffee continuing its strong trajectory, recording a 56% growth for the quarter. The Ready-to-Drink (RTD) business delivered a 25% revenue growth despite unseasonal rains and heightened competitive intensity.

The India Foods business revenue increased by 19%. Value-added salt portfolio performed well, growing 23% during the quarter. Tata Sampann portfolio continued its momentum, growing by 40% for the quarter.

International Business

The International business revenue grew by 9% in constant currency terms, primarily driven by strong coffee performance in the USA. Eight O'Clock coffee continued to gain market share within bags and K-Cups for the fourth consecutive quarter.

Non-Branded Business

The Non-Branded business, which includes plantation and extraction business for tea, coffee, and other produce, saw a significant growth of 26% in constant currency terms.

Innovation and Expansion

TCPL maintained a strong pace of innovation with 25 new product launches during the quarter across categories. Some notable launches include:

• Tata Tea Agni's category-first Energy tea with added caffeine in select markets
• Tata Sampann's gravy masala mixes and a range of unpolished millets
• Capital Foods' new products like Chings Chilli Oil, Korean Ramen, and Korean Kimchi noodles

Tata Starbucks

Tata Starbucks added 7 net new stores during the quarter, bringing the total number of stores to 492 across 80 cities. The joint venture also extended coffee experiential store formats in Mumbai, Hyderabad, and Chennai.

Management Commentary

Sunil D'Souza, Managing Director & CEO of Tata Consumer Products, commented on the results: "We delivered a strong topline growth of 18% in Q2, with steady net profit growth. This was the 2nd consecutive quarter of double-digit growth in the India core business across both tea and salt. Tata Sampann continued its growth momentum and launched several new products during the quarter. The RTD business recorded robust growth despite unfavourable weather conditions."

He further added, "We remain focused on building for the future with growth, innovation and consumer trust at the heart of everything we do."

Outlook

With its strong performance across segments and continued focus on innovation and expansion, Tata Consumer Products appears well-positioned for sustained growth. The company's ability to deliver robust results despite challenges such as unseasonal rains and heightened competition demonstrates its resilience and strong market position in the consumer products sector.

Tata Consumer Products Limited (TCPL) has reported a robust performance for the second quarter, with significant growth in both revenue and profit. The company's strategic focus on its branded business and operational efficiency has contributed to this strong showing.

Revenue Growth

TCPL's consolidated revenue from operations for Q2 stood at ₹3,595.00 crores, marking an impressive 18% increase compared to the same quarter of the previous year. This growth was driven by strong performances across various business segments.

Profit Performance

The company's standalone net profit grew 28% year-on-year to ₹285.00 crore for the quarter ending September 30.

Segment-wise Performance

• International Business: Revenue grew 9% in constant currency terms
• Starbucks Joint Venture: Achieved 8% revenue growth with 492 stores across 80 cities

GST Transition Impact

Tata Consumer Products managing director Sunil D'Souza reported that three brands - Capital Foods, Organic India, and Tata Soulfull - experienced sales impact during the GST rate cut transition phase, with business disruption exceeding expectations. The company had been achieving decent double-digit growth before the GST transition.

• New GST rates were implemented from September 22 following the August 15 announcement
• Capital Foods sales were particularly affected in modern trade during September
• The ready-to-drink business remained unimpacted due to its impulse consumption nature

Brand Performance

Management Commentary

Sunil D'Souza, Managing Director and CEO of Tata Consumer Products, commented on the GST transition impact and overall performance. The company remains focused on navigating the challenges posed by the GST rate changes while maintaining growth momentum across its diverse portfolio.

Outlook

While TCPL has shown strong growth, the company is addressing the short-term impacts of the GST transition on specific brands. The management continues to focus on innovation, brand building, and operational efficiency to maintain growth momentum and improve profitability across all segments.

Investors and analysts will be closely watching TCPL's performance in the coming quarters, particularly its ability to manage the GST transition effects and maintain growth in various business segments. The company's diverse portfolio and strong market position in both domestic and international markets position it well for continued growth, despite temporary challenges in certain brand segments.