INTEGRATED ANNUAL
REPORT 2022-23

Business review

Unlocking value,
accelerating growth

During the year, we continued to focus on increasing our distribution reach, expanding our total addressable market, investing behind key brands, and streamlining and synergising our operations to unlock value.

India business performance

We continued to execute on our transformation agenda to deliver strong results for the India business. We strengthened our innovation capabilities and revamped our R&D facilities to accelerate innovation and build future readiness. New product launches were 2x of the previous year. We have made consistent progress in our direct reach as well as total reach with expansion in rural and semi-urban areas and split routes in larger towns with populations greater than one million. Alternate channels continued to fuel our growth and innovation agenda, with both Modern Trade and E-commerce channels showing strong growth and contributing 14% & 9% respectively towards India sales.

INR 8,717 Cr 10%*

India business revenue

71%

Share in total branded revenue

*Increase vs PY

PROGRESS MADE IN FY 22-23

Packaged Beverages India

  • Revenue for the year declined 5%, with 1% volume decline owing to weakness in some of our key markets and price corrections. This brings the three year CAGR of the business to 10%
  • Maintained the momentum on innovation with several new launches in both tea and coffee
  • Continued to maintain market leadership in tea in e-commerce
  • Strengthened focus on premiumisation; the premium tea portfolio grew faster than the mass economy portfolio
  • Coffee revenue rose by 31% led by new SKU launches and roll-out in new geographies
  • Tata Tea Gold Care continued to see strong traction post its roll-out across India
  • Sharpened brand strategy by consolidating brand architecture across the portfolio. including the Tata Tea Agni Masterbrand architecture consolidation
  • Continued with our hyperlocal brand-building strategy for key brands

Packaged Foods India

  • Salt revenue grew 25%, delivering a three year CAGR of 19%
  • The value-added salts portfolio grew to 4.5X, in part led by new innovations like Tata Salt Immuno
  • Launched Shuddh by Tata Salt, a solar salt for the South to expand the market. Also launched Vitamin Shakti, Iron Health and Pink Salt to build a portfolio of value-added salt variants to drive premiumisation
  • Tata Sampann portfolio delivered strong growth of 29%, with broad-based performance across staples and dry fruits
  • The dry fruits segment scaled up well with strong growth and share gains across e-commerce platforms
  • Tata Sampann launched customised pure and blended spices for the South market
  • Expanded the addressable market by entering the protein category with Tata Simply Better and Tata GoFit
  • Tata Soulfull continued its strong growth trajectory, up 100%+ YoY
  • Tata Soulfull profitability profile improved through initiatives on reducing manufacturing and freight costs
  • Ready-to-eat (RTE) business (formerly Tata Q) was relaunched under the new brand name of Tata Sampann Yumside with a revamped and expanded portfolio

Liquid Beverages

  • NourishCo had a landmark year, recording INR 621 crores in net sales for the year, up 80% YoY
  • Tata Copper+ franchise scaled to 2.1x
  • Expanded capacity to 2x to support growth
  • Himalayan water grew 85% YoY and continued to be EBIT positive.
  • Himalayan was positioned as a provenance brand and extended into premium preserves and honey
  • Launched Tata Fruski Juice n Jelly, a disruptive format of drinkable jelly in select markets

Tata Starbucks

(50:50 JV)

  • Launched 71 new stores (highest ever annual addition to the store count) across 15 new cities and continued expansion into Tier-2 cities
  • Revenue grew 71% YoY, and the business was EBIT positive
  • The ‘My Starbucks Rewards’ loyalty programme crossed 2.3 million customers
  • Launched the first Starbucks Reserve store at the Flagship Mumbai location
  • Introduced Picco, a new small-size for hot beverages, in select stores
  • Expanded the health-forward portfolio with a vegan menu, salads, and protein boxes

International business performance

We focused on strengthening our non-black tea portfolio in Fruit and Herbal and Specialty teas and have adopted a 3-brand strategy focused on Tetley, Good Earth and Teapigs to have a complete play in the overall tea market. At the same time, we are also rejuvenating our black tea portfolio and strengthening our coffee portfolio in the US. We have implemented structural changes to make the business leaner and stronger. We are adding new vectors of growth - we have recently entered the fast-growing Indian Ready Foods segment with Tata Raasa, a range of RTEs and RTCs tailored for local preferences in those markets.

INR 3,589 Cr 8% (5%*)

International business revenue

29%

Share in total branded revenue

PROGRESS MADE IN FY 22-23

UK

  • Revenue for the year was flat (constant currency) vs PY
  • We implemented a series of price increases to mitigate input cost inflation which has resulted in strong sequential margin improvement.
  • Tetley gained share in everyday black, speciality and green tea segments.
  • 12 new Tetley lines were listed across 230 stores of Morrisons, the UK’s fifth largest supermarket chain
  • Completed integration of teapigs brand with Tata Consumer UK

USA

  • Coffee revenue for the year grew 7% (constant currency).
  • We implemented a series of price increases to mitigate input cost inflation which has resulted in strong sequential margin improvement.
  • EOC K-cups continued to drive growth of the brand led by focused execution
  • Teapigs was the fastest-growing brand in Specialty tea, growing 4X the category
  • Tata Raasa RTE range launched within select Ethnic grocery stores

Canada

  • Revenue for the year grew 9% (constant currency).
  • We implemented a series of price increases to mitigate input cost inflation which has resulted in sequential margin improvement.
  • Tetley maintained its market leadership position led by market share gains in the regular tea segment.
  • New distribution for Tata Tea led to rapid growth, albeit off a small base
  • Tetley Super Teas strengthened its presence with direct-to-home tea sampling and social media campaigns to drive trial and awareness
  • Rolled out Tata Sampann and Tata Tea digital campaigns on popular South Asian websites to drive awareness and trial of products, targeting the Indian diaspora

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