India's Tata Consumer misses profit view as domestic beverages drag

Tata Coffee

25/04/2023 13:27

BENGALURU, April 25 (Reuters) - India's Tata Consumer
Products Ltd  TACN.NS  on Tuesday reported a slightly
smaller-than-expected rise in fourth-quarter profit as price
hikes failed to offset tepid revenue growth in its domestic
beverage business.
    The company, which owns the eponymous Tata Tea and Tata Salt
brands, said its consolidated net profit rose 23% to 2.69
billion rupees ($32.85 million) in the quarter ended March 31. 
    Analysts on an average expected a profit of 2.70 billion
rupees, according to Refinitiv IBES data.
        The company's consolidated revenue climbed nearly 14% to
36.19 billion rupees, led largely by a 15% rise in its India
business, beating analysts' view of 35.11 billion rupees.   
    However, the share of the India business fell to 62% of
revenue from 70%, as domestic beverages grew a weak 8% and tea
volumes grew a bare 3% consecutively.
    The company, which packages spices, pulses and cereals under
the Tata Sampann brand, said cost of raw materials grew 11.4% to
13.38 billion rupees.
    Tata Consumer Products is among the first consumer goods
firms to report results. Earlier in the day, Maggi noodles
producer Nestle India  NEST.NS  reported a near-25% jump in
quarterly profit.
    Quarterly revenue from Tata's joint venture with Starbucks
Corp  SBUX.O  in India mounted 48%, while the international
business that sells brands like Tetley Tea in the United Kingdom
and Eight O'Clock coffee in the United States, rose 10.5%.
    "We have seen a sequential improvement in international
business margins and expect it to normalise by Q1FY24 (the
current quarter)," the company said. 
    Last week, its unit Tata Coffee Ltd  TACO.NS  reported a
near-20% increase in quarterly profit.
    Shares of Tata Consumer have fallen 4.24% so far this year. 

($1 = 81.8990 Indian rupees)

 (Reporting by Hritam Mukherjee and Nandan Mandayam in
Bengaluru; Editing by Sohini Goswami)
 ((Hritam.Mukherjee@thomsonreuters.com; +91 9830427878;))