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International business of TATA global beverages
 

International business of TATA global beverages

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International business of TATA global beverages

International business of TATA global beverages

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    International business of TATA global beverages International business of TATA global beverages Presentation Transcript

    • TATA GLOBAL BEVERAGES Deepa Agarwal Mayur Bhagwat Neha Baokar Kunal Garad Mayur Mohite Shruti Railkar Kunal Thakur 1 Akanksha Wattal
    • DOMESTIC BUSINESS 2
    • Domestic Scenario of Tea Industry 1962 to 1990-Pre Liberalisation Era  Rising Input cost, High taxes and Dwindling margins  Tata Tea incorporated in 1962 as Tata Finlay J.V  1983 Finlay stake acquired-Tata Tea ltd  Decided to move from commodities market to branded tea market E.g. Kannan Devan, Agni, Gemini and Chakra Gold  In 1987, Tata Tea set up a fully owned subsidiary, Tata Tea Inc., in the USA.  1989-52% stake Karnataka based Consolidated Coffee Ltd(Tata coffee Ltd) 3
    • contd… Post 1990-Post liberalization Era  In 1992-J.V with Tetley  In 1994-Acquired 64.5% stake in Asian Coffee  JVC with Lankan partner acquired 20 tea estates  Acquisition of the Tetley Group 2000  In 2006, Tata Tea acquired Eight O'Clock Coffee, a U.S. based coffee producer from Gryphon Investors for $220m  On 30 January 2012, 50-50 joint venture called Tata Starbucks Ltd  Current Tea Industry 4
    • DOMESTIC SCENARIO-TATA TEA 5
    • INTERNATIONAL BUSINESS 6
    • 7
    • PESTEL ANALYSIS 8
    • Political • Fair trade • Tea brake • Approach is positive Economical • Local retailer poliies • Switching cost • UK Economy Social Technological • 800 millions cups of tea consumed globally • Green tea is preferred due to its health benefits • Innovation on tea products • Providing unique products • Safety Factor 9
    • PORTERS FIVE FORCES 10
    • PORTERS MODEL Threat from substitute : •Coffee •Pepsi • Energy drinks Bargaining power of suppliers : • Large number of producers • Low switching cost Rivalry : • Approximately 700 tea companies • Unorganised players • Industry growth rate 2% Bargaining power of Buyer : • Large number of buyers •Other available option Threat from new entrants: • 100 % FDI • Untapped rural market 11
    • STRATEGY 12
    • MERGER • The first ever leveraged buy out , largest cross border acquisition by an Indian Company. • The acquisition of Tetley made Tata Tea the second biggest tea company in the world. • Vertical Integration Tetley gets access to Tata Tea’s gardens and production base and the latter gets Tetley’s premium brands and global distribution network 13
    • Structure of Merger 14
    • FINANCE 15
    • Post Merger Financial Performance sales dropped by 8.3% Rs 621.58 crore from Rs 677.86 crore operating profit dropped down by 19.37% Rs 121.43 crore from Rs 150.60 crore 16
    • Financial Restructuring • Producing tea company to selling tea company • Tata tea decreased its – total wage payment by 12.5% – provident fund payment by 43% – welfare payment by 40% – Employee strength from 58,888 workers to 34,596 workers 17
    • Revenue by Geography Geography Sales Revenue (Rs. Lakhs) 13.48 India 31.11 India 150816.83 UK UK 123942.34 USA & Canada USA & Canada 144671.83 29.84 Rest 65356.48 Total 25.57 Rest 484787.48 Revenue % Source: http://www.tataglobalbeverages.com/docs/document-manager/tata_fact_sheet18 v15.pdf?sfvrsn=0
    • OPERATIONS 19
    • MANUFACTURING PROCESS Plucking Rolling Firing Cooling Packing 20
    • STRATEGIC BUSINESS UNITS PTD SIPD NIPD ITD IBD 21
    • RECOMMENDATION AND CONCLUSION 22
    • Recommendation and Conclusion •Exploiting Rural markets •Differentiation on the basis of quality •Tea houses in tea consuming countries •Promotion of Tata Global beverages products at Starbucks •Promoting products like iced tea in countries where soft drinks are consumed •Forming JVs with competitors 23
    • 24