Tata Consumer Well-Positioned To Capitalise On India Growth Momentum: Chairman

India's consumer market constitutes a long-standing structural opportunity. This is pushed by population, a growing middle class, rapid urbanisation, increasing disposable incomes and raising aspirations, according to N Chandrasekaran, chairman at Tata Consumer Products Ltd.

The FMCG arm of the Tata Group is well-equipped to capitalise on the significant opportunity, he said, while addressing the annual general meeting of TCPL on Thursday.

The Indian economy is growing very strongly and the momentum remains good, said Chandrasekaran.

India is likely to maintain similar growth momentum in the coming years, he said, adding that the global economic landscape has been rather volatile with geopolitics reshaping supply chains, energy security, and overall resilience.

The baseline forecast for the world economy is to continue to grow over 3% during 2024 and 2025.

However, India has been growing very strongly with the economic growth rate of 8.2% for fiscal 2024, Chandrasekaran said. "Looking at the future, the momentum continues to be high and India should maintain similar growth momentum in the coming years."

Notably, India's consumer market represents a 'long-term structural' opportunity, Chandrasekaran said and noted that this is driven by a young population, a growing middle class, rapid urbanisation, increasing disposable income, and rising aspirations.

Chandrasekaran also added that the Indian middle class is growing rapidly, which will create opportunities for the company.

"India's middle class is expected to grow from about 30% of the population to 50% by the end of this decade. That is about an additional 300 million people who will be entering the middle class," he said.

Apart from this, rapid urbanisation, increasing disposable incomes and ever increasing aspirations of consumers all bode well for Tata Consumer Products, which is well positioned to capitalise on the significant opportunity, he said.

Over the latest acquisition of Capital Foods and Organic India by TCPL, Chandrasekaran said, this is to expand the company's addressable market into high-growth, high-margin segments.

"The company has scaled its distribution to reach 4 million retail outlets in India, which represents a two-fold increase since 2020. The company has also focused on innovation and has replaced a 5 times growth in innovation revenue since the fiscal year FY21," he said.

At TCPL, new innovations contributes 5% to sales distribution, which is in line with the best metrics in the industry.

"The company's digital transformation agenda has been progressing well," he said.

On Tata Starbucks, its 50:50 JV with Starbuck, he said it has opened 95 new stores in FY24, setting a record for the highest number of stores opened in a single year since inception. "The company's international business has been progressing well," he said.

In FY24, TCPL's revenue stood at Rs 15,206 crore, a growth of 10%.

TCPL was formed in 2020, after merging the consumer products business of Tata Chemicals with Tata Global Beverages. It owns brands such as—Tata Salt, Tata Tea, Tetley, Eight O'Clock Coffee, Good Earth Tea, and Tata Sampann.

(With inputs from PTI)