Tata Consumer Products Limited: history, ownership, mission, how it works & makes money

A Brief History of Tata Consumer Products Limited

Tata Consumer Products Limited (TCPL), formerly known as Tata Global Beverages, has a rich history that intertwines with the Tata Group's broad spectrum of enterprises. Founded in 1962, the company initially focused on the beverage sector, primarily tea. In 2019, it rebranded itself as Tata Consumer Products to reflect its expansion into the broader consumer goods space, including coffee, water, and other food products.

TCPL achieved significant milestones over the decades. In 2015, TCPL reported a total revenue of ₹9,052 crores (approximately $1.35 billion), showcasing its robust market presence within the Indian subcontinent and abroad. The company’s net profit for the same year was ₹773 crores (about $116 million).

In 2020, TCPL made a pivotal move by acquiring a majority stake in the iconic beverage brand, “Tea Estates of Darjeeling,” enhancing its portfolio within the premium tea segment. The acquisition price was reported at ₹1,000 crores (around $135 million), a strategic decision aimed at cementing its foothold in the high-quality tea market.

TCPL emphasizes sustainability and ethical sourcing, which are pivotal in its operational strategies. In 2021, the company reported that over **90%** of its tea was sourced sustainably, aligning with global consumer trends that favor environmentally responsible brands.

In the fiscal year 2022, Tata Consumer Products Limited reported total revenue of **₹13,513 crores** (approximately **$1.84 billion**). The net profit stood at **₹1,432 crores** (about **$192 million**), indicating a growth trajectory despite the challenges posed by the pandemic.

As of October 2023, Tata Consumer Products Limited continues to innovate and expand its product lines, focusing on health-conscious offerings and sustainable practices. The stock performance on the National Stock Exchange of India (NSE) reflects positive investor sentiment, with the share price fluctuating around **₹700** per share, up from **₹500** earlier in 2022.

In addition to its core beverage business, Tata Consumer Products Limited has entered into the breakfast foods segment, launching its health-oriented product range under the Tata Soulfull brand. The breakfast foods market in India is projected to grow at a CAGR of **7.3%** from 2021 to 2026, indicating strong potential for TCPL.

With an employee base of over **5,000** worldwide, TCPL has demonstrated resilience and adaptability in the competitive consumer goods market, aligning its strategies with evolving consumer preferences and sustainability trends.

Looking at the market share, Tata Tea holds approximately **20%** of the Indian tea market, solidifying its status as a leading player in the industry. The company’s commitment to quality and innovation continues to drive its growth trajectory in various markets globally.

A Who Owns Tata Consumer Products Limited

Tata Consumer Products Limited (TCPL) is a prominent player in the consumer goods sector, particularly in the beverage and food segments. As a publicly traded company, its ownership is divided among various institutional and retail investors.

As of the most recent data, the ownership structure of Tata Consumer Products Limited is as follows:

The largest shareholder of Tata Consumer Products Limited is the Tata Group, which holds a significant portion of the promoter stake. Specifically, Tata Sons Private Limited is the principal entity within the promoter group, underscoring the group's influence in the management and strategic direction of TCPL.

According to the latest quarterly report for Q2 FY2023-24, Tata Consumer Products Limited reported a revenue of ₹3,224 crores (approximately $390 million), reflecting an increase of 12% year-on-year. The company's net profit for the same quarter stood at ₹391 crores (around $47 million), representing a growth of 18% compared to the previous year.

In terms of stock performance, Tata Consumer Products Limited's share price as of October 2023 is ₹676.50, with a market capitalization of approximately ₹79,800 crores (about $9.6 billion). The stock has shown resilience, with a 52-week high of ₹897.00 and a 52-week low of ₹620.00.

The company is also part of key stock indices, including the Nifty 50 and BSE Sensex, which reflects its strong position in the Indian market and the confidence of institutional investors.

Overall, Tata Consumer Products Limited's ownership structure illustrates a balanced distribution between promoters, institutional investors, and retail participants, showcasing its appeal across various investor categories. The financial performance further confirms the company's robust standing in the consumer goods landscape.

Tata Consumer Products Limited Mission Statement

Tata Consumer Products Limited (TCPL) is a key player in the fast-moving consumer goods (FMCG) sector, primarily focused on food and beverages. The company aims to enhance the quality of life of its consumers through its commitment to sustainable practices and innovation.

According to TCPL's latest Annual Report for the fiscal year 2022-2023, the company's mission statement emphasizes creating a healthier lifestyle and a sustainable environment. The mission is driven by their core values of integrity, excellence, and responsibility.

TCPL's commitment to sustainability is reflected in their operational strategies. The company aims to reduce its carbon footprint by implementing eco-friendly practices across its supply chain. As of FY 2022-2023, TCPL has reduced its greenhouse gas emissions by 15% compared to previous years.

Furthermore, the mission extends to community engagement, with TCPL investing around ₹100 Crores annually in various community initiatives, including education, health, and skill development programs.

In terms of product innovation, TCPL launched approximately 30 new products in FY 2022-2023, focusing on health-oriented categories such as organic teas and ready-to-eat meals, aligning with consumer trends towards healthier lifestyles.

Financially, the company has consistently shown growth. The revenue growth rate from the previous fiscal year stands at 12% year-on-year. This reflects the company's strategy to diversify its portfolio in response to changing consumer preferences.

TCPL's vision is clear: to be a leader in the FMCG sector while fostering a healthier lifestyle for consumers and a sustainable environment for future generations. The mission statement serves as a guiding principle that informs every aspect of their operations, from product development to community engagement.

How Tata Consumer Products Limited Works

Tata Consumer Products Limited (TCPL) operates as a consumer goods company, focusing on food, beverages, and personal care products. It is a part of the Tata Group, one of India's largest conglomerates. The company is primarily involved in the production, marketing, and distribution of tea, coffee, and food products. As of the fiscal year ending March 2023, TCPL reported a total revenue of ₹13,610 crore, an increase from ₹12,122 crore in the previous fiscal year, reflecting a growth rate of approximately 12.3%.

TCPL's product portfolio is segmented into several categories, which include:

• Tea
• Coffee
• Packaged Foods
• Water
• Personal Care Products

In the tea segment, TCPL is recognized for its flagship brand, Tata Tea, which contributed significantly to its revenue. The tea business saw an increase in sales from ₹6,000 crore in FY 2022 to about ₹6,600 crore in FY 2023. Meanwhile, the coffee segment, which includes brands like Tata Coffee Grand, achieved a revenue of ₹1,500 crore in the same period, demonstrating a steady growth trajectory.

TCPL operates through various channels, with an emphasis on both traditional retail and modern trade. The company has expanded its distribution network significantly, reaching over 2 million outlets across India. This focus on distribution is crucial in enhancing brand visibility and accessibility to consumers.

Technological advancements play a critical role in TCPL's operations. The company has invested in digital marketing strategies and supply chain optimization tools to enhance efficiency and customer engagement. As part of its sustainability initiatives, TCPL has committed to sourcing 100% of its tea from sustainable sources by 2025, aligning its practices with global sustainability goals.

In terms of financial metrics, TCPL's EBITDA for FY 2023 stood at ₹1,763 crore, with a margin of approximately 12.95%. The company continues to focus on improving operational efficiencies, which has resulted in a net profit of ₹1,200 crore for the same period, reflecting a profit margin of 8.81%.

TCPL's stock performance on the Bombay Stock Exchange has been robust, with a 50% increase in share price over the last year. As of October 2023, the stock was trading at approximately ₹800 per share, up from ₹533 in October 2022.

Furthermore, TCPL maintains a strong return on equity (ROE) ratio of 18% and a return on assets (ROA) of 7.3%, indicating effective management and utilization of shareholder equity and company assets.

Overall, Tata Consumer Products Limited operates with a strategic focus on innovation, market expansion, and consumer engagement, solidifying its position as a leading player in the consumer goods sector in India.

How Tata Consumer Products Limited Makes Money

Tata Consumer Products Limited (TCPL) generates revenue through a diverse portfolio primarily centered around food and beverage products. The company operates in various segments, including Tea, Coffee, and Food, leveraging strong brand recognition and extensive distribution networks.

Revenue Breakdown

As of the fiscal year ended March 2023, Tata Consumer Products reported total revenues of ₹12,220 crore (approximately $1.48 billion). The major revenue contributors are:

• Tea: ₹9,100 crore (about 74.5% of total revenue)
• Coffee: ₹1,500 crore (around 12.3% of total revenue)
• Food: ₹1,620 crore (approximately 13.2% of total revenue)

Key Revenue Streams

The company's revenue generation strategies include:

• Branded Tea and Coffee Products: TCPL sells a variety of tea and coffee brands, including Tata Tea, Tetley, and Tata Coffee, catering to different consumer preferences.
• Instant Food Products: This includes products like instant noodles and snack foods, which have gained popularity in the Indian market.
• Exports: TCPL exports its products to more than 40 countries, providing a significant additional revenue stream.

Market Share

As of Q2 2023, Tata Consumer Products holds a market share of:

• 42% in the packed tea segment in India
• 12% in the instant coffee segment in India
• 10% in the instant food products sector

Sales Performance

Profit Margins

For the fiscal year ending March 2023, Tata Consumer Products reported:

• Gross Profit Margin: 35%
• Operating Profit Margin: 14%
• Net Profit Margin: 8%

Recent Developments and Strategies

In recent quarters, TCPL has adopted various growth strategies including:

• Product Diversification: Introduction of new products in the health and wellness category to meet changing consumer preferences.
• Digital Expansion: Enhanced focus on e-commerce channels, reporting a growth of over 60% in online sales in FY 2023.
• Sustainability Initiatives: Investment in sustainable sourcing, leading to an estimated reduction of carbon emissions by 20% in the last year.

Financial Outlook

For FY 2024, Tata Consumer Products expects:

• An expected revenue growth of 10-12%
• Continuous focus on operational efficiencies, aiming to improve cost structures and enhance profitability.