Tata Global Beverages, formerly Tata Tea Ltd, posted consolidated net profit of Rs 45.5 crore for the quarter ending June 30, against a net loss of Rs 19.6 crore last year.
Consolidated net sales grew eight per cent to touch Rs 1,373.9 crore against Rs 1,275.1 crore last year in the quarter.
The company attributed the growth in sales to higher price realisation. Prices have been raised over recent months in response to input cost pressures. Though L K Krishnakumar, chief financial officer of Tata Global Bevarages, did not specify the extent of these raises, he said it varied across markets. “We have taken solid price increases in Great Britain and allied markets,” he said.
Tata Global Beverages derives much of its revenue from operations outside India.
The escalation in input costs this quarter, Krishnakumar said, was 15 per cent. Purchase of traded goods increased 35 per cent this quarter. But the company managed to rein in its advertising and sales promotion expenditure, which rose by only 3.7 per cent. Even employee costs were subdued at 3.4 per cent, while miscellaneous expenditure increased by 8.5 per cent.
JV with Pepsi may go beyond India
The scope of the joint venture (JV) between Tata Global Beverages, formerly Tata Tea Ltd, and Pepsi Co India will not be restricted to the domestic market, Tata Global Beverages Deputy CEO Percy Siganporia told Business Standard. “There is no doubt in my mind that discussions are not geographical. But, very necessarily, the JV has to start with a base, establish its credentials and then move on,” said Siganporia.
