Tata Consumer Products reported a 16% rise in Q2 net profit to ₹470 crore as its Indian business posted double-digit volume growth. The company’s revenue grew 14% to ₹5,661 crore, supported by strong performance in its Sampann and ready-to-drink segments. While India operations drove gains, international markets faced challenges, and the tea category saw flat volume growth.
Tata Consumer Products reported a consolidated net profit of ₹470 crore for the second quarter of the 2027 fiscal year, reflecting a 16% increase compared to the same period last year. The company's revenue from operations reached ₹5,661 crore, a 14% rise from the ₹4,966 crore recorded in the previous year. These results highlight a divergence between the company’s strong domestic performance and more difficult conditions in international markets.
India Volume Growth and Segment Performance
The company’s India branded business acted as the primary engine for the quarter, recording 11% underlying volume growth. This was largely driven by its high-growth segments, such as Tata Sampann and the ready-to-drink portfolio, which expanded by 57% and 47%, respectively. These categories now represent 38% of the company's total India business, showing success in the firm’s strategy to diversify beyond its traditional tea business.
While the salt division performed well with a 15% revenue increase, the domestic tea segment faced difficulties. Volume growth in tea remained flat, largely due to subdued category demand. For investors, the ability of the company to maintain growth in tea while scaling its new businesses will be a key factor in future performance.
International Headwinds and Retail Expansion
The company faced a complex environment in international markets. While revenue grew 7% in rupee terms, it fell 2% on a constant currency basis. Management pointed to a high base effect and weather-related disruptions in the UK as the main reasons for this performance.
On the retail front, the Tata Starbucks joint venture reached a milestone, achieving 15% revenue growth, which stands as a multi-quarter high. The chain has expanded its reach to 505 stores across 81 Indian cities. As the company continues to invest in scaling these operations, it has also begun integrating artificial intelligence into its sales and logistics processes to drive productivity.
What Investors Should Monitor
Moving forward, investors may track the company’s ability to manage costs while executing its expansion strategy. The shift toward premium products is a central theme, with 22 new products launched during the quarter. Key monitorables include the volume recovery in the domestic tea category, the impact of international market conditions on overall margins, and the effectiveness of the company’s new AI-driven initiatives in improving operational efficiency.