Tata Consumer Products Ltd (TCPL), which is betting big on the huge growth opportunity in the spices industry, is looking to foray into the southern markets with its customised offerings to suit the taste of the local palate.
According to Sunil D’Souza, MD & CEO, TCPL, the company is planning for a relaunch on spices and would be entering the southern market.
The market for spices is estimated to be close to ₹60,000 crore, which is even bigger than tea. However, branded spices in India form a ₹23,400 crore industry. It is a highly cluttered market, driven by regional preferences for taste. The product mix in spices needs to be tailored as per the geography and the market, TCPL said in its latest annual report (2021-22).
“We are looking at a full relaunch of our blends. There is a huge growth opportunity,” D’Souza said in an investors’ call while detailing on the company’s April-June performance. The company sells its spices under the Tata Sampann brand. During 2021-22, the Tata Sampann portfolio continued to grow in the double digits and in spices, it crossed the ₹100 crore benchmark (gross sales), the annual report said.
Consumers are now looking for unadulterated, hygienic and authentic spices, and convenient to use blended spices is driving the demand for organised players like Tata Consumer. The ongoing pandemic has also reinvigorated the discussion on traditional recipes, and the usage of spices to strengthen immunity which is driving demand for branded players, the report said.
Food: The growth engine
Food will be one of the key growth engines for TCPL driven by salt and the Sampann portfolio. The company has now got brands across different price bands in salt and beverages, and it would want to make sure that it gives value to the consumers and continue to gain market share.
The company will focus on balancing both growth as well as margins even while it sets out to expand its portfolio. Tata Consumer, which aims to become a food company, has been steadily expanding its portfolio on foods. The company has already identified the areas of growth, and the segments which it will enter shortly. However, it will enter only those segments where it can have a market leadership or obtain a considerable market share, D’Souza said.
During the first quarter of the current financial year, the company gained 40 basis points market share in the branded tea segment in the country, with margins from tea improving by 1,000 basis points, he added.
The company’s salt portfolio continued its momentum and recorded double digit growth during the quarter, despite a high base in Q1 last year. The salt portfolio also continued to record market share gains. The premium salts portfolio recorded a 36 per cent growth during the quarter continuing its trajectory in line with its premiumisation agenda.
The Tata Sampann portfolio grew by 6 per cent during the first quarter, led by short term impact of trade terms, margin rationalisation, realignment across channels and pullback ahead of spices relaunch.