The global environment has been challenging due to volatile macroeconomic condition and geopolitics but the company remains steadfast and is focusing on building a strong platform for progress, Tata Consumer Products Ltd (TCPL) Chairman N Chandrasekaran said on Tuesday.
Addressing shareholders at the annual general meeting, he said TCPL has been on a transformative journey and has made significant progress during the last three years into becoming and evolving as a leading FMCG company.
”During this period, a number of decisive actions have been taken to become a growth-oriented company and build a strong organisational capability,” he said.
The company continues to focus on strengthening its core business and at the same time, work on new opportunities to expand the target addressable market, said Chandrasekaran, who is also the chairman of Tata Sons, the holding firm of Tata Group.
”The global environment has been sort of challenging due to a volatile macroeconomic condition as well as the geopolitics under these circumstances, the company remains steadfast and has been focusing on executing the strategic agenda and build on a strong platform that it has,” he said.
Progress of TCPL is visible as its sales and distribution network has expanded three folds to 1.5 million outlets. The company has set up a fit for the future R&D capability that has helped step up the pace of innovation.
Last year, the company launched twice the number of products as in the year before.
”The innovation agenda of the company is driven by key consumer trends, namely wellness and health, digitisation, and convenience. This has helped the company improve its innovation to sales ratio from 0.8 per cent to 3.4 per cent in the last three years,” it said.
During these three years, TCPL delivered a strong compound annual growth rate (CAGR) of 17 per cent in revenue terms.
On its JV Tata Starbucks, Chandrasekaran said TCPL has ”stepped up the pace” and opened the highest-ever number of stores at 71 in FY23.
”With this, Starbucks is getting to reach close to 350 stores,” he said.
Tata Starbucks is a 50:50 joint venture between Starbucks Corporation and TCPL.
Talking about TCPL’s international business, he said though it has recorded decent growth in revenue terms, the margin has been affected by commodity inflation as well as currency movements.
”The company is focused on strengthening the portfolio for its international business in terms of growing its non-black tea business, opening up the reach for its coffee business and also getting the ethnic, ready-to-eat and ready-to-cook products in the international markets,” he said.
Chandrasekaran also expected the merger of Tata Coffee to be completed this year as part of a simplification of the company’s structure.
He also paid respect to Tata veteran RK Krishna Kumar, who passed away earlier this year.
”RKK shaped the evolution of your company from being a simple plantations company to be a global major in the Tata beverages segment and Tata tea became a household name in this country under his leadership,” he said adding Kumar led the group’s international acquisition by acquiring Tetley.
In 2022-23, TCPL’s consolidated revenue was Rs 13,783 crore.