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Tata Consumer Q2 net profit at Rs. 359, revenue rises 11%, exceeds estimates

Tata Coffee merger with Tata Consumer Products, TCPL Beverages set for January 1

Tata Consumer Products Limited is engaged primarily in the business of manufacturing, marketing, distribution, and sale of consumer products, with offerings across food and beverage categories such as tea, coffee, water, edible salt, spices, protein foods, ready-to-eat and ready-to-drink beverages, and various other consumer products under brands including Tata Tea, Tetley, Tata Salt, and Tata Sampann, among others.

Tata Consumer Products Ltd. (TCPL) for second quarter of FY24 reported a 6.55 percent decline in its consolidated net profit to Rs 363.92 crore, despite strong growth in its domestic business. The decline in profit was due to an exceptional income from the sale of land last year. The company had posted a net profit of Rs 389.43 crore in the July–September quarter a year ago.

Revenue from operations rose 11.02 percent to Rs 3,733.78 crore during the quarter under review, as against Rs 3,363.05 crore in the year-ago period. Consolidated EBITDA increased by 30% YoY at Rs 569 Crs, with an EBITDA margin of 15.2%. The India business's EBITDA grew 11% YoY. International business EBTIDA grew 49% in constant currency YoY. EBITDA margin expanded 330 basis points to 12.4%, mainly driven by pricing interventions and savings from restructuring. EBITDA for the non-branded business grew by 61% in constant currency terms. EBITDA margin expanded 700 basis points, mainly due to better realizations. India business from branded businesses contributed 72% of total revenue, while international business contributed 28% of total revenue from branded businesses.

According to Managing Director and CEO of TCPL, Sunil D’Souza, the company’s India tea business continued to benefit from its earlier interventions, resulting in a third consecutive quarter of volume-led growth. “In our salt business, we have seen consistent revenue growth and premiumisation at play. We continued our strong momentum on innovation with a number of new product launches across categories, further expanding our total addressable market.”

He further said, “Our growth businesses (Tata Sampann, Tata Soulfull and NourishCo, and Tata Smartfoodz) continued their strong momentum and have increased their contribution significantly in line with our portfolio transformation ambition. Tata Starbucks also delivered strong overall performance while continuing its expansion agenda.”

TCPL’s packaged beverages business in India grew 5 percent YoY and 3 percent by volume, while Tata Sampann's portfolio recorded a robust growth of 47 percent YoY. India Foods Business delivered 16 percent revenue growth and 6 percent volume growth, it said in a statement. Tata Starbucks recorded revenue growth of 14 percent for the quarter on an annual basis. TCPL unveiled 22 net new stores during the quarter and entered two new cities. This brought the total number of stores to 370 across 49 cities.

Tata Consumer Products has approved the amalgamation of its three wholly-owned subsidiaries, including NourishCo Beverages Limited, Tata SmartFoodz Limited, and Tata Consumer Soulfull Private Limited, with the company.

The stock opened positive and is trading in positive territory at Rs. 914.

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