Tata Global net down 13% at Rs 97.23 cr, plans Rs 150 cr capex

Tata Global Beverages, which owns the second largest tea business in world after Unilever, today reported a near 13 per cent drop in its net profit at Rs 97.23 crore for the quarter to June.
It also announced to invest Rs 150 crore in capex this fiscal to build business and market development.
The city-based company, which is primarily into tea, coffee and water businesses, said the consolidated net declined due to lower revenues at it coffee business due to seasonal factors and an exceptional gain of Rs 21.63 crore by sale of investments in the year-ago period.
"Had it not been for these two factors, our Q1 net income would have grown 10 per cent," company's Executive Director and Group Chief Financial Officer L Krishnakumar told PTI here.

On the seasonality factor impacting the bottomlines, Managing Director and Chief Executive Ajoy Misra said, "The profitability was impacted due to lower crop available for sale in the plantation business and investment in new ventures."
On the capex plans, Misra said the group as a whole will be pumping in around Rs 150 crore this fiscal for various business and brand development.

TBG owns many tea brands under Tata Tea and Tetley names apart from coffee brands like Tata Coffee in the domestic market and Eight O' Clock in the US, and two water brands - the super premium Himalayan and Tata Water Plus, which is the mass brand.

Net sales in the quarter rose 5 percent to Rs 1,883.95 crore from Rs 1,796.15 crore, the CFO said.
On the business going forward, Misra said, "We are committed to investing in our brands, in a challenging market environment. In addition to organic growth, innovation, category expansion and strategic alliances will drive growth for the business."
Revenue from tea segment, which constitutes over 70 per cent of its income, grew 10.14 per cent to Rs 1,451.1 crore while revenue from coffee, which chips in with around 20 per cent of overall income, and other products declined 8.17 per cent to Rs 430.24 crore. The remaining 10 per cent income comes mostly from its plantation business (around 8 per cent) and the water business adds to the rest.