Lanka unit part of Tata Tea-Tetley integration

The operational integration binding Tata Tea and Tetley into one beverage company includes Watawala Plantations, the company's join venture in Sri Lanka.

Watawala has not only been the major tea sourcing hub, but also the local exporting and packaging arm of The Tetley Group.

Explaining the extent of integration between the operations of the three companies, Percy Siganporia, managing director Tata Tea said, Watawala procures the laminations for packaging even for The Tetley Group, while Tetley's Asian tea requirements were being met through a group operatinng out of Tata Tea.

Watawala mentions in its annual report that there were several other benefits that had filtered down from this synergy including sharing of marketing and technical expertise by Tata Tea and The Tetley Group.

Tata Tea was in the process of chalking out a fresh strategy to beef up its presence in the world market, by growing its branded business, which accounts for 86 per cent of the revenues.

Siganporia said, Sangeeta Talwar, the newly appointed executive director (marketing) Tata Tea would evolve a strategy for the company's further expansion into the branded territory.

According to figures, the total tea market was estimated to be in the region of $10-$12 billion, across the globe. Tata Tea occupied five per cent of the global tea space.

Siganporia said, the company was present in only 35 per cent of the tea consuming market and hence the company would study whether it made strategic sense to tap the 65 per cent of the uncovered market or consolidate its existing position.

He added that the forms of tea as consumed over the years had also changed and there were growth options in green, herbal, fusions and ready-to-drink tea categories.

When asked whether the company was eyeing brand acquisitions, Singanporia said, the company would go in for acquisition, if it added value to the company's branded business.

The focus for the company, at this juncture, was clearly the branded business and the vision as charted out by Tata Tea was to become a leader in the branded tea business, across the globe.

However, while the focus would be on tea, Siganporia clarified that the other businesses like coffee and spices were not being shot down.