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Eyeing an additional revenue source, Kanan Devan Hills Plantations Company is betting big on its new trade retail initiative Ripple Tea Chai Bazar, which sells Munnar high-grown teas and other value-added products on the tourist highway in the hill station.
KDHP has converted its over-the-counter model into a modern trade retail format on a pilot basis in Munnar town, which fetched a sales revenue of ₹20 crore. “Buoyed by its success, four more Chai Bazars were opened in the past 18 months with a target of achieving sales revenue of ₹35 crore in the current fiscal,” said Mathew Abraham, Managing Director and CEO.
“It is a unique concept to showcase Munnar teas that could match with best of the teas in the world,” Abraham said adding that the company is exploring opportunities to open more such outlets in other parts of Kerala and Tamil Nadu.
Besides providing freshly brewed teas, these outlets offer free parking facilities and modern clean rest room facilities which is a major requirement for tourists visiting the hill station.
KDHP has an essential oil and fragrance extraction unit and the aromatic section in these outlets sells a range of oils such as Tea Tree oil, Eucalyptus, Lemon grass, Citriodora, Vetiver, Geranium. The chocolate making unit in Maduppatty supplies 16 varieties of speciality item.
The Managing Director pointed out that the viability and sustainability of plantations are a big challenge due to high wages, stagnant tea prices, climate change etc. Given such situation, he said that value-addition in terms of brands and opening up of retail formats are expected to improve the revenue of the company, thereby enabling it to remain competitive in the market.
Driven by the growth in value addition, KDHP has ended the FY19 with a PAT of ₹3.8 crore over a turnover of ₹358 crore compared to the ₹0.48 crore profit in the previous fiscal.
Faced with all the challenges plaguing the sector, he said that the company is hopeful of achieving a 5 per cent growth in its revenue stream in FY20.
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