To launch the brand in New Zealand and Indonesia

Mumbai :

Tata Global Beverages is planning to make its acquired coffee brand from Australia, Map, a power brand in its portfolio. After almost a year since the acquisition, it intends taking Map to New Zealand and Indonesia, but launching it in India remains a distant possibility.

“India is still not a big market for branded coffee. Even the big brands like Nestle and Bru do not have adequate size. We will take Map to New Zealand and Indonesia and it will be a power brand like Tetley and Tata Tea,” said Ajoy Misra, Managing Director & CEO, Tata Global Beverages.

While the beverage company is ruling out a branded play in India and insists on being a B2B player with its subsidiary Tata Coffee, it has tried to sample a few brands in the past. “We did have a few branded packs under Mr. Bean and Coorg Coffee, but it has not been a major attempt at branded play,” said Misra.

However, the company might extend Map into the food services segment in India, catering to the corporate and institution segments. “There could be a chance for Map to enter the food service business in India as it has corporate accounts in Australia. There could be further possibilities for the brand here as the market gets more organised in the food services segment,” said Misra. Map is present in roast, ground coffee, single serve coffee pods and machines in the food service industry.

The market leader in tea with a volume share of 24 per cent, Tata Global Beverages is now looking forward to the high growth green tea segment to shore up its profitability. “The price per cup is higher in green tea compared to black tea and we expect greater profitability from this segment,” he said. It has also dropped price points by 20 per cent with a new variant of green tea for the masses under ‘Acti Green’. “We are getting 30 to 40per cent growth from the green tea segment and it is a growth engine for the company,” he said.

Meanwhile, profitability is elusive for its acquired brands like Himalayan from Mount Everest Mineral Water and coffee retail business under the JV with Starbucks. “Starbucks has completed two years, but it takes time to get profitable in the QSR segment. While we have 75 Starbuck stores, it has to cross the critical level of over 100 stores before we can think of making money in this segment,” observed Misra.

However, the beverage major is still looking at inorganic growth opportunities to build its portfolio. “We gave not stopped looking at opportunities and we seek both organic and inorganic growth,” he added. Tea comprises 75 per cent of the company’s turnover while coffee contributes about 18 per cent while the balance incomes is from smaller categories like water and plantations business.

source: http://www.thehindubusinessline.com / Business Line / Home> Companies / by Purvita Chatterjee / Mumbai – June 01st, 2015