Eveready may brew premium tea brand

Eveready Industries India, the tea and battery maker from the Brij Mohan Khaitan stable, is planning to grow its packet tea business and is even considering to launch a new brand.

Deepak Khaitan, executive vice-chairman and managing director, Eveready, said that the company is planning to come out with a premium brand, which would be priced higher than Taj Mahal, a Hindustan Lever brand.

The brand would be launched next year. At present, the company has three brands""Jago, Tez and Premium Gold, which cater to the popular and mass segment.

Eveready, once the world's biggest bulk tea producer, has been increasingly focusing on its packet tea business.

Khaitan said, the volume in the packet tea business would be around 4,500 tonne by March 2004. In the next fiscal, this could go to 7,000 tonne.

Khaitan said, the essential ingredients for success in packet tea business are an established distribution channel and access to bulk tea.

Eveready already has a distribution network in place for its batteries' business, which is being leveraged for packet tea distribution.

On the bulk tea front, the company's production is around 40 million kg.

Eveready is also planning to enhance capacity of its tea factories.

Khaitan said, "We are planning to modernise some of the factories." The company is looking at increasing its exports. The new markets to be explored are Russia, Kazakhstan, Iraq, Iran and Pakistan.

Eveready, which would close the year with an export of 90 lakh kg is expecting higher exports next year.

The rationale behind the optimism is that the situation in Iraq is expected to become better and relation with Pakistan is also expected to take a more positive turn. If the two markets performed better, then exports would automatically improve.

On the debt restructuring front, Khaitan said that once the tea business picked up, the company would be able to pay back a substantial portion of the debt.

Meanwhile, Eveready has identified some idle properties including some factory land for sale. The proceeds would be utilised for reducing the debt burden.