Will focus on select FMCG sectors: Harish Bhat

Priyanka Pani Mumbai | Updated on January 13, 2018

HARISH BHAT, Chairman, Tata Global Beverages Ltd

Tata Group, in the last one decade, has been slowly working towards becoming a consumer-facing company by increasing its presence in the FMCG space. Harish Bhat, Chairman, Tata Global Beverages Ltd and Brand Custodian of Tata Sons spoke to BusinessLine around the conglomerate’s FMCG play, and which companies the group will focus on and what they are doing to become a full-stack consumer company. Tata Group has companies like Tata Global Beverages, Croma, Tata Chemicals, Trent, Tata Coffee, Tital and Starbucks.

How has Tata Group positioned itself in the FMCG (fast moving consumer goods) space?

The Tata group has a very strong presence in the FMCG space. Tata Salt dominates the salt category, and Tata Tea is the market leader in the tea category and its portfolio in the tea segment, like Tata Agni etc. Between these brands, we reach out to about 550 million people in India, so, approximately half the population of India either consumes or drinks a Tata brand every single day.

With that kind of a presence, do you have a leadership position at this moment?

We are very cognizant of the market leadership provision that we have. First and foremost, I believe in the highest quality of the products and services to the customers.

Whether it is black tea or salt or coffee or water, I think our products go through the most stringent quality norms. We want to provide our customers the highest quality of products that offer maximum value. I think that is the driving force behind our success.

How has the consumption pattern changed in the last 2-3 years?

Indian consumers today are far more aspirational in their desires. They want value but they also want indulgence. And more and more consumers in the middle class and upper middle class are aspiring to buy brands which look good, feel good, offer them both health and indulgence going together.

Secondly, Indian consumers are far more sensitive about health and wellness. I find people very sensitive to and focussed on health. From young people to older people, I think health and wellness is a driving trend today.

The Tata group has a fairly good presence in the consumer space starting from salt to gold, so what is the strategy?

Tata brand covers various categories. In FMCG, Tata global beverages has a very clear vision of making very stronger brands in tea, coffee and in water. Similarly, the foods business of Tata chemicals has a very strong vision of building brands in salt on the one side, which has food ingredients, and nutritious wholesome foods on the other such as unpolished dals and the Tata Sampann spices. So, we have chosen 5-6 categories in foods and beverages under which we want to build very powerful brands on the back of the brands that we already have.

Is Tata planning to be a full stack FMCG group?

I think we will select sectors in FMCG. FMCG is very broad and can extend to many categories. Currently, the sectors we have selected are beverages and food, which in itself are very large. So, our first priority over the next couple of years will be to establish and consolidate our presence in these new categories that we have entered. Let me give you an example of another new category that we have entered i.e. water. We have entered the water market through the Himalayan brand, the first salt water in India. You can now see it at the airports, modern super markets, and if you go to restaurants, Himalayan water is there. So, there is a large role FMCG is building up in these areas as well.

As a group, how prepared is Tata for GST?

Each of our companies is preparing its own road map for GST preparedness. Companies are working towards being supply-chain ready. Our strong belief is that GST will be very positive for the industry, will create a level-playing field for the organised sector. In the post GST environment, we are confident that various brands of the Tata group will gain market share.

Published on March 09, 2017

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