Tata Tea Analysis Essay Example

common marketing systems and a global database to control market parameters better. Additionally, Tata Tea is currently working towards diversifying their product portfolio, which includes more than just black tea, to become a broader beverage company that includes green tea, rooibos, fruit juices, and herbal products.During the forecast period, Tata Tea is expected to pursue acquisitions and introduce new products in bottled water and RTD tea. Additionally, the company aims to reinforce its presence in the premium tea market by launching various wellness and specialty estate teas, flavored teas, and Tetley green tea for high-end consumers. They will also continue expanding their volumes in rural areas through their regional brands with low prices and wider distribution. Tata Tea has taken advantage of favorable government policies towards the tea industry in India by acquiring Jemica and capturing 26% of the local market in Czech Republic. They are collaborating with the Tea Board of India to introduce Indian tea in new markets and revive marketing campaigns in existing markets. The company plans on “soft launches” in various regions including Gulf countries, West Asia North Africa (WANA) countries, Syria, Jordan, and selected markets in the Far East. In terms of financial assessment, Tata Tea reported a 12% growth in net sales to Rs.4,874. The Tetley brand will be offered by the Tetley Group in most developed markets worldwide as well as Pakistan, Bangladesh, and Russia.In FY09, the company's revenue increased to Rs. 5,170.0 crore from Rs. 4,336.3 crore in FY08, due to a 10% growth in the tea business and a 20% growth in the coffee business. The operating profit was Rs. 650.5 crore, which was 8% lower

than FY08, primarily due to the increase in raw material consumption resulting from the rise in commodity prices. The OPM decreased by 303bps to 13.4%. Additionally, there was a significant reduction in interest costs.