New Delhi: Tata Tea plans to consolidate its position in health and wellness segments by launching more products in these categories apart from introducing newer products in existing categories.
The Bangalore-based company is outperforming the industry. “We have been growing at 8% to 9% for the last four to five years against the industry's growth rate of around 3.5%”, Sushant Dash, associate president (marketing) of Tata Tea said.
Among its tea brands, Agni, which has sells at 70:30 ratio in rural and urban markets, is growing at 15%. It is the fastest growing brand in the company's stable. Tata Tea’s high-end brands like Gold has a 90:10 sales ratio in rural and urban markets and Premium has a 50:50 rural-urban ratio.
Tata Tea, which captured 21% of the marketshare in value terms and 20.9% in volume terms, has overall sales ratio of 35:65 in rural and urban areas.
“In South Asia, the company is focusing more on India rather than Pakistan and Bangladesh”, said Sangeeta Talwar, executive director, Tata Tea. Currently, Tata Tea's exports are very low at 1,000 tonne in Europe, the US, Canada and the UK.
With rise in commodity prices, the input cost of tea companies has gone up by around 20% to 25%, which the company has passed on to consumers.
Tata Tea sources tea only from the country only as import duty for this commodity is very high at 100%. It mainly picks up from auctions in Guwahati, Kolkata, Cochin, Coimbatore and Siliguri.
The biggest two markets for Tata Tea is North and South India, which contribute 30% each. The rest of India — east and west – contribute equally to the remaining 40%. The fastest growing segment is, however, the north, which is growing around 8%.