Yes Chings and Organic India is expected to drive 12% of the expected 30% India growth brands as they call it (Non Tea, Salt and Coffee) business. That is now 20% of the total business.
They mentioned that Organic India is avlb in only 47,000 stores. Potential is huge. They 10x the stores for a start and can add 600-700 crores to topline in a couple of years. Starbucks, they said they don’t add to topline revenues. Profit is aggregated in consolidated results. Planning for 1000 stores by FY28-29.
Copper+ is doing well as per them. 60% of Nourishco Business with topline of 900 Crores means its a 540 crores business. My belief is that its better they did not buy Bisleri. Low Margin High Overheads Business. Its better to focus on higher margin businesses. They need an energy drink and maybe get into aerated beverages and colas. That would boost topline, increase overall penetration.
Tata consumer is consolidating from January 2024. Already below 10 week EMA and , 30 week EMA is getting flatter. Last both quarters, sales have been low and earnings have been negative. So seems to be going into consolidation Stage 3 . I amd having a small position, which i will be getting rid of soon.
So as expected moving forward with the plan to be across all FMCG categories. This was primary reason for my investments starting last year. Now its all about execution and keeping track whether company performs.
Disclosure: Invested across family accounts at much lower price. Almost 7% of personal pf.
With Tata consumer rights issue, wanted to check with experts here that how can we apply for more than the rights entitled to us?
Say if 5 rights shares are entitled, can we apply for 50 or is there any upper limit?
If we apply for 50, still at least 5 we will surely get as we are entitled to those 5 or we may not even get those if we apply for more?
If we want to buy more in rights issue, what’s the best plan? Should we buy others rights entitlement - who intend to sell …and if yes, how do we do that?
Disc: Invested & biased. Not a buy/sell recommendation. Post only to learn on basics of a rights issue.
Tata Consumer Products Limited demonstrated resilience in Q1 FY25, with consolidated revenue growing 16% year-over-year. The company’s performance was driven by strong growth in India Foods (30%), International business (10% in constant currency), and non-branded segment (33%). However, the India Beverages segment faced headwinds due to an intense summer, resulting in flat volumes and a 1% decline in revenue.
Strategic Initiatives:
Integration of recent acquisitions: TCPL has completed the integration of Capital Foods and is on track to finish Organic India’s integration within 100 days.
Distribution expansion: The company has increased its feet on street, with dedicated salesmen for different product categories in larger cities.
Channel diversification: TCPL is piloting entry into pharmacy channels and food service to expand its reach.
Innovation focus: The company is emphasizing breakthrough, margin-accretive innovations like Tata Salt Panch Tatva and Easy Cook Ragi Atta.
Trends and Themes:
Premiumization: Value-added salts grew 35%, indicating a shift towards premium products.
E-commerce growth: The segment saw 61% growth, with quick commerce contributing 35% to e-commerce sales.
Modern trade expansion: 28% growth in modern trade channels.
Industry Tailwinds:
Growing demand for value-added and premium products
Increasing penetration of organized retail and e-commerce
Rising health consciousness driving demand for fortified and functional foods
Industry Headwinds:
Volatile commodity prices, especially in tea and coffee
Erratic weather patterns affecting production and demand
Intense competition in key categories
Analyst Concerns and Management Response:
Concern: Slow growth in the NourishCo business
Response: Management acknowledged the need for corrections and is implementing tactical pricing decisions and product innovations.
Concern: Impact of heat wave on tea consumption
Response: The company is working on making its systems more robust to handle demand fluctuations and commodity cost variations.
Concern: Lower-than-expected revenue from Capital Foods
Response: Management explained that Q1 was a learning quarter and expects normalization going forward.
Competitive Landscape:
TCPL faces competition from both multinational and local players in various categories. The company is leveraging its strong brand portfolio, distribution network, and recent acquisitions to maintain its competitive edge.
Guidance and Outlook:
No specific guidance was provided due to the ongoing rights issue, but the management expressed confidence in delivering on the business case for recent acquisitions and continuing the growth trajectory in key segments.
Capital Allocation Strategy:
The company recently announced a rights issue to repay short-term debt financing raised for acquisitions. This move is expected to strengthen the balance sheet and provide flexibility for future growth initiatives.
Opportunities & Risks:
Opportunities:
Expansion into new channels (pharmacy, food service)
Cross-selling opportunities from recent acquisitions
Premiumization across categories
Risks:
Commodity price volatility
Execution risks in integrating acquisitions
Intense competition in key categories
Regulatory Environment:
The company appears to be operating within the existing regulatory framework.
Customer Sentiment:
While not explicitly discussed, the growth in premium categories and e-commerce suggests positive customer sentiment towards TCPL’s products.
Top 3 Takeaways:
TCPL’s diversified portfolio helped offset challenges in the tea segment, with strong performance in foods and international business.
The company is focused on innovation and distribution expansion to drive growth.
Integration of recent acquisitions (Capital Foods and Organic India) is progressing well and expected to be accretive to margins.
Can Anyone please guide me regarding the Tata consumer RE shares getting traded in bourses currently?
I understand the traded price of these shares are difference between actual Tata consumer share price and the Rights share price. But till when these shares will be traded? I have bought some shares of them and got them for delivery.
You just bought the rights entitlement and no shares as such. You need to subscribe to the rights issue before the cut off date. Else you get nothing and the money gone
