Tata Consumer Products Earnings Grow 36% to 355 Crore in Q2 FY23

• Tata Consumer Products’ sales increased 11% year-over-year to 3,363 crore.
• The margin was impacted by inflationary and price pressures in international markets.
• Amid heightened inflation and adverse currency movements, the FMCG player says it will implement a cost-cutting plan to protect margins.

Tata Consumer Products’ second quarter net profit grew 36% to 355 crore, from ₹261 crore in the same quarter last year. Revenues increased by 11% to 3,363 crore from 3,033 crore in the same period.

The EBITDA margin declined to 13% in Q2 FY23, compared to 13.9% in Q2 FY22.

“We again delivered double-digit sales growth, while balancing margins despite inflationary pressures, weak currencies and some slowdown in pricing in international markets,” said Sunil D’Souza, MD & CEO of Tata Consumer Products.

Turning to the domestic business, India’s packaged beverages recorded a 7% decline in sales due to price adjustments and overall softness in the category.

The Tata Salt, Tata Sampann, NourishCo, Tata Soulfull and Coffee segments witnessed strong growth momentum.

“We have accelerated the pace of innovation this year, with twice as many new launches as in the same period last year. Our new growth engines – Tata Sampann, NourishCo, Tata Soulfull have achieved significant growth and are expanding their portfolio and reach. Our out-of-home businesses – NourishCo and Tata Starbucks, posted strong growth during the quarter,” D’Souza said in a grant application.

Tata Starbucks posted strong sales growth of 57% for the quarter, led by normalized retail activity and a rebound in out-of-home consumption.

Amid heightened inflation and adverse currency movements, the FMCG player says it will implement cost-cutting plans to protect margins.

“While unprecedented inflation and adverse currency movements in our international business weighed on our margin this quarter, we will drive structural cost-cutting initiatives to improve the trajectory going forward. Our transformation agenda to become a leading FMCG company is still on track,” the company said.

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