In the packed tea segment, Tata Tea, world’s second largest tea operation, has outplaced Hindustan Unilever to attain the top place in terms of sales volume during June 2007.

Tata Tea’s share stand at 19.2% in June as compared to 18.6% of HUL. HUL has been a leader in the Indian organised tea market with successful brands such as Taj Mahal, Brooke Bond and Lipton.

Tata Tea had been positioning its offering different and building a wider distribution network. It has witnessed strong growth in Tata Tea Premium and Tata Tea Gold and repositioned its Agni brand.

It has also forayed into new segments by launching Tata Tea Life with natural herbal extracts, Tetley Green Tea  and a special long leaf single origin teas in the premium segment.

In 2002, HUL’s (formerly HLL) market share was 26.1% while that of Tata Tea was 16.3%. But the gap has been narrowing down since then and for the first time in June HUL lost its pole position to Tata Tea.

The much anticipated decision of Tata venturing into beverage retail outlets has finally been implemented. Tata Coffee Ltd., owned 51% by Tata Tea would be opening 100 coffee outlets over next 5 years around the country.

Currently, Tata Coffee has one outlet in Kochi under brand name Mr. Bean Junction. Initially the outlets would be opened in southern metro cities, where there is greater demand for such outlets.

The coffee retail segment has been witnessing great expansion over the years. With Barista and Café Coffee Day having a nationwide presence, and international chains Cost Coffee already present and Starbucks preparing the blueprint for entry, the sector will experience tough competition.

Tata Tea with its wide portfolio and tea and coffee products, along with other beverages and mineral water, could offer a complete drinks package. It could also leverage on its buyouts of Eight o’ Clock Coffee, Tetley, Mount Everest Water and other proposed global acquisitions.

After making a killing last week in the Glaceau stake sale, Tata Tea is again in the news, this time for buying out Mount Everest mineral water. according to reports, Tata Tea may buy 11% stake from the promoters and make an open offer at Rs. 145-150 per share, valuing the company at over Rs. 500 crores. Tata Tea would spend Rs. 250 crore on the stake buy.

The promoters will make a preferential allotment to Tata Tea. MEMW is now owned by a group of NRI investors who bought the company from the Dadi Group. It manufactures natural mineral water under the brand ‘Himalayan’, and holds a 70% share in the niche mineral water segment and also has one of Asia’s largest natural mineral water plants. Other two prominent players in natural mineral water are ‘Evian’ from France and Catch. Other mineral water players like Aquafina, Kinley, Bisleri are packaged after being treated in plants.

»

The Tatas have done it again in the global business world, the only difference being, this time not as a strategic investor but as a financial investor. Tata Tea, world’s second-largest branded tea firm, in less than a year’s time has reaped in a handsome return on its investment in the US based Energy Brands Inc, maker of Glaceau vitamin water.

Tata Tea had acquired a 30 per cent stake in Glaceau, having $355 million turnover, in August 2006 for a consideration of $677 million thus valuing it at $2.3 billion. This transaction was Tata Tea’s second biggest global footprint after its acquisition of UK based Tetley. At that time of the transaction, Tata Group had projected Glaceau’s annual revenue to nearly double to 700 million dollars in 2007. Tata Tea saw value in Glacaeu owing to its range of Smartwater, Vitaminwater and Fruitwater which proved an instant success.

»