TATA Consumer Products Limited - Integrated Annual Report 2020-21

India business performance

Delightful products. Stronger value proposition.

Our philosophy of ‘For Better’ also extends across our businesses. Across categories, we are aiming to strengthen our presence, widen reach, accelerate innovations and deliver delightful products to consumers.

PACKAGED BEVERAGES- INDIA

In Tea, we strengthened our existing offerings, while exploring new alternatives that revitalise well-being. Our tea offerings celebrate India’s diversity through distinct blends, state specific packaging and local insight-based communication that caters to regional taste and preferences. We also expanded our portfolio to include offerings focused on health and wellness as well as a range of luxury teas.

Our coffee is sourced from our subsidiary Tata Coffee’s estates and offers the goodness of quality beans in every cupful. We have stepped up our focus on coffee this year. We are innovating in this segment to ensure we keep pace with evolving coffee preferences. We currently have instant coffee, filter coffee and a premium roast and ground offering in our portfolio.

Progress in FY 20-21

Robust and broad-based performance across our brands, recording double-digit growth
Significant YoY growth in e-commerce channels
Significant improvement in working capital - stood at 48 days as of 31^st March 2021 down from 78 days (days of sales) as of 31^st March 2021, despite extraordinarily high inventory led by raw tea inflation
Profitability of the segment was impacted by unprecedented raw tea inflation but we made huge strides in volume growth and market share gains

32%

Growth in revenue

19%

Volume growth in coffee

12%

Volume growth in tea

100 bps

Market share gain*

Figures of FY 20-21 | *Source: Nielsen Value share, Moving Annual Total (MAT) basis March 2021 vs March 2020

PACKAGED FOODS- INDIA

Through a quality range of staples, spices, mixes, breakfast cereals and mini-meals our offerings span a wide range of consumption occasions. We are market leaders in the salt category and are reaching 200 Million households every month across India with our iodised salt. Over the last two decades now, Tata Salt has lived up to its claim of being 'Desh ki Sehat, Desh ka namak'. We have also launched value added salts in order to premiumise our portfolio and offer healthier choices to consumers.

Our Tata Sampann range of products are crafted on the belief that health and taste must both accompany one’s food, without compromising one or the other. The range offers unpolished pulses and spices with their wholesome nutrition and natural oils retained, which also makes it taste better. It also has ready to cook nutri-mixes which offer benefits on wellness along with convenience. During the year, we launched a number of new products in the Tata Sampann portfolio, in keeping with the health and wellness and convenience trend. With our recent acquisition, Tata Consumer Soulfull Pvt Ltd. is our fully owned subsidiary. Tata Soulfull brand operates in the Health and Wellness focused food segment with a portfolio of millet-based products for kids and adults.

Progress in FY 20-21

Salt revenue grew 17% during FY 20-21
Continued to drive premiumisation with value added and niche salt portfolio growing 75% YoY
Tata Sampann portfolio grew ahead of the segment at 26% YoY
EBIT for the segment grew 45% YoY, through strong cost optimisation efforts
Drove working capital (WC) efficiencies to bring WC to negative territory as of 31^st March 2021
Introduced multiple new products across staples and mixes categories during the year

18%

Growth in revenue

180 bps

Market share gain for salt*

11%

Volume growth in salt

Figures of FY 20-21 | *Source: Nielsen - Value share, Moving Annual Total (MAT) basis March 2021 vs March 2020

NOURISHCO

NourishCo is a wholly owned subsidiary and has focused on building brands in the healthy hydration space offering non-carbonated, ready-to-drink beverages. Portfolio comprises Himalayan mineral water, Tata Gluco Plus and Tata Water Plus.

Progress in FY 20-21

Growth in revenue impacted on account of COVID induced lockdowns and reduced OOH consumption
Business saw strong sequential recovery from December quarter onwards
Tata Gluco Plus (TGP) and Tata Water Plus (TWP) were key drivers of growth during the year
TWP achieved highest ever volume, growing 60% YoY
Fit for purpose go-to-market strategy and strong cost optimisation in Himalayan yielded results with 76% expansion in its retail footprint
Tata Fruski, the fruit based new product was launched in Hyderabad and Vizag received great initial response
Geographic expansion and capacity addition for the business is on track

Rs.188 Crs

Revenue

1.5x

Tata Water Plus*

4%

Growth in revenue

Figures of FY 20-21 | *53% growth in revenue during the year

TATA STARBUCKS

This joint venture brings the unique Starbucks experience to Indian consumers along with the trust and reliability of the Tata name. We exited this fiscal with 221 stores across 18 cities. Apart from its extensive product offerings in store, Tata Starbucks is also expanding through delivery channels and online mediums.

Progress in FY 20-21

Revenue for the year declined 33% YoY, driven by the adverse impact of COVID on OOH consumption but the business still managed to remain EBITDA positive for the year
Business saw sequential recovery till February, but localised lockdowns and curfews induced by the second wave of the pandemic have begun to impact store operating hours in several cities in the later part of the year
Added 39 new stores this year, which is among the highest ever since its launch in India
Forayed into 7 new cities (Lucknow, Amritsar, Kochi, Ludhiana, Bhopal, Indore and Kanpur)
Experimented with new store formats– drive-thru and small engine stores to capitalise on takeaway and delivery opportunity
Significant savings achieved through rental renegotiations and overhead optimisation
My Starbucks Rewards (MSR) customer base witnessed a growth of 18% over last year and boasts of a loyalty base 9 Lakh+ customers
Limited Time Offerings (LTO), family packs and merchandise were some of the initiatives driven to mitigate the pressure on OOH consumption

94%

Stores reopened*

221

Total stores

18

Cities

*As of 31^st March 2021