 "Consumer mkt presents long-term structural opportunity: N Chandrasekaran")
India’s middle class is expected to grow from about 30 per cent of the population to 50 per cent by 2030, making the consuming class bigger and resulting in a big opportunity, N Chandrasekaran, chairman of Tata Consumer Products Ltd (TCPL), on Thursday told shareholders at its annual general meeting.
He also said: “Apart from this a young population, rapid urbanisation, increasing disposable incomes and rising aspirations bode well for the overall FMCG (fast-moving consumer goods) space in India.”
Chandrasekaran began his speech addressing the uncertainty globally due to geopolitical tensions and said the global economic landscape had been volatile owing to growing political shifts reshaping supply chains, energy security and transition gaining momentum, and artificial intelligence entering the mainstream.
He added the baseline forecast for the world economy was to continue growing at 3.2 per cent during 2024 and 2025 and India continued to be a strong growth market with a growth rate of 8.2 per cent in FY24.
He said TCPL was well positioned to navigate the evolving macro-economic landscape and unlock value creation opportunities.
“India’s consumer market presents a long-term structural opportunity,” he said, adding that Tata Consumer Products was ready to capitalise on this.
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He added the company had taken strides in its transformation journey to becoming a best-in-class FMCG company and had witnessed five times growth in innovation revenue since FY21.
It now has a 5 per cent innovation-to-sales contribution, which is the best in class for the industry.
He said digital transformation had progressed well and the highlight was the launch of a new go-to-market platform aimed at transforming sales and distribution.
Its joint venture with Starbucks opened 95 stores last financial year, the highest since inception.
“The simplification agenda continued to make progress. TCPL completed the merger of Tata Coffee and is making headway in consolidating the number of international legal entities,” he said.
While answering shareholders’ questions, Chandrasekaran said the company’s FY25 capacity expansion would be bigger.
Last year, the company’s capex plan was around Rs 308 crore.
“In FY25, capex (would be) Rs 785 crore, because of a big investment we are making in Vietnam in a new plant. It’s about Rs 400 crore.”