Tata Group’s consumer staples firm is set to report its earnings for the first quarter of the curent fiscal year on July 23, 2025. According to experts, Tata Consumer Products Ltd. (TCPL) is likely to see strong double-digit sales growth, led by a strong performance in its domestic business.
According to a Moneycontrol poll of eight brokerages, Tata Consumer is likely to report revenue at Rs 4,849 crore, surging 11 percent on-year compared to Rs 4,352 crore in the June quarter of FY2025.
Net profit is likely to come in at Rs 340 crore, up from Rs 307 crore from the corresponding quarter last year, rising by 10 percent YoY.
Earnings estimates of analysts polled by Moneycontrol are in a diverse range. The most optimistic estimate sees TCPL’s net profit rising 23 percent on-year, however the most pessimistic projection suggests that net profit might sink one percent.
What factors are impacting the earnings?
Margins: According to Japan-based Nomura, softening coffee prices would impact Tata Consumer Products' plantation and extraction margins (as it no longer benefits from low price inventory) and the stepup in ad spends is expected to put pressure on near-term margins. Brokerages are pencilling in a sharp contraction in EBITDA margins, down to 12.9 percent compared to 15.3 percent in the year-ago period.
Salt, Tea businesses: The domestic tea business is likely to see a volume growth of 2-3 percent, ad value growth between 9-12 percent, according to brokerages. The India foods business will likely see a strong quarter, driven by the salt segment that saw higher volumes and price hikes.
Capital Foods, Organic India: The Capital Foods and Organic India arms are likely to report a combined revenue between Rs 200 crore and Rs 300 crore, as per projections. Nuvama noted that in the base quarter, Capital Foods was counted for the full quarter while Organic India was accounted for two and a half months. A decline in QoQ revenue is expected due to supply chain issues for Organic India in the U.S. and a general urban slowdown.
International, unbranded businesses: The international arm like likely to report mid-single digit growth in constant currency terms, as a result of price increase in U.S. coffee in June. The growth in unbranded business could come in high-single digits.
What to look out for in the quarterly show?
Analysts will closely monitor demand in metro areas and tier-3 towns. Tea and coffee prices are also key monitorables, as coffee and tea prices come-off highs. The impact of the raw material pricing on margins will be closely watched, as well as the growing competitive pressure from unorganized players.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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