For the quarter that concluded on December 31, the company recorded a consolidated profit before unusual items and tax of Rs 513 crore ($61.8 million), a 27% increase over the same period the previous year.
India's Tata Consumer Products reported a surge in third-quarter profit on Wednesday, aided by greater demand for tea and basics over the Christmas season, while being hindered by an unexpected one-time charge. The company reported a consolidated profit before unexpected items and tax of Rs 513 crore ($61.8 million) for the quarter that ended on December 31. This is a 27% increase over the same time the previous year.
Service charges, business restructuring, and acquisition-related costs totaled Rs 91.53 crore for the company. Operating revenue increased by about 10% to Rs 3,804 crore, mostly due to a 10% increase in its domestic business.
For the quarter that concluded on December 31, the company recorded a consolidated profit before unusual items and tax of Rs 513 crore ($61.8 million), a 27% increase over the same period the previous year. The company accounts for 62.4% of its overall income.
The main beverages segment of Tata Consumer expanded by 8%, with tea volumes rising by 2% due to persistent domestic demand. Analysts claim that even though its pricing was higher than those of competitors ITC and Marico, the company benefited from the robust demand for necessities like salt. The core profit margin of Tata Consumer increased by 190 basis points to 15% in the previous year. The Tata Group company reported an 11% increase in its overseas business. It also operates a joint venture with Starbucks in India.
According to managing director and CEO Sunil D'Souza, "we saw premiumization at play in both tea and salt, with the premium portfolio in tea and the value added salt portfolio recording good growth."
The results of Tata Consumer came after larger competitor Britannia Industries revealed a nearly 2% decline in profit as a result of decreased demand in rural areas and increased competition from smaller producers of packaged foods.
ITC, on the other hand, revealed higher-than-expected profit thanks to price increases. Tata Consumer said in January that it will pay Rs 5,100 crore to acquire a 75% share in Capital Foods, which is well-known for its "Ching's Secret" and "Smith Jones" brands, and Rs 1,900 crore to acquire Organic India, a manufacturer of health goods. Tata Consumer's stock closed 0.23% higher than the results.
