MUMBAI, India
In an interview with DNA India reporters Shailaja Sharma & Nupur Anand , Tata’s new Managing Director and CEO Harish Bhat, anticipates strong growth in beverage sales with tea remaining dominate in the company but fast growth expected in coffee and bottled water. Bhat is the former head of the watches division at Titan Industries who assumed his new role last month. He started his career at Tata Group.
Tata currently earns 70% of its revenue selling tea, 20% selling coffee and less than 2% selling bottled water.
“It used to be a tea company, now it is present across a range of beverages -- tea, coffee and water. Today, it is a global company and present across continents in the world. Going forward, those proportions will change. I would see the percentage of coffee expanding as we go forward. But tea will always remain the core,” he told interviewers.
But tea business is a constant with challenges…
“The tea business has shown splendid growth during the first quarter (ended June 30, 2012). The tea business in India has grown by over 15%, notwithstanding volatility in tea prices and price increases. Tea, after water, is the second least expensive drink ever known to the mankind. Even, water these days is sometimes more expensive than tea. Tea business will continue to grow. The volume growth in domestic business during the first quarter was 9.5%.”
About 65% of the company’s sales already come from outside India. Will the proportion between domestic and international play change?
“We are growing in all parts of the world, so I will not anticipate a major change in that proportion. International sales will continue to contribute a majority, we are a global company. In the first quarter, every market has grown well. The highest growing geography in this quarter, however, has been India in percentage terms,” said Bhat.
Will innovations like Tata Water Plus and Tata Gluco+ go into your international portfolio, and will Chai Latte come to India?
“As far as water is concerned, yes, in the future it will. But at the moment, our first focus is to make it very successful within the country. We are just about test-marketing Tata Water Plus in Tamil Nadu and Hyderabad; we will later roll it out across the country. It will transform the way water is had by Indians. At the moment, Cha Latte has been launched in Australia, we plan to take it to Europe and other geographies. In the future it could come to India. Tata Gluco+ is an innovation that has the potential to sweep India and many other markets. It can become a very healthy alternative to carbonated drinks, but we have not evaluated its potential for outside India,” said Bhat.
Source: DNA India