It is estimated that almost 28-odd per cent of the local and regional players control about 200 brands in the market. These local manufacturers belong to that category which does not use audio-visual media to advertise their product.

Market analysts contend that the exit route for this particular category of packers would be much faster than that of established players or the stronger regional players.

For a marginal player to absorb Rs 12 on a one-kilo tea pack would be a very difficult proposition, which would prompt a changeover to loose tea trade.

Moreover, as an industry observer says, consumers of these packets would find it very difficult to pay an increased price for the same volume.

Out of a total volume of 240 million kg in the packet form, 45 per cent of the gross sales is to the `economically lessprivileged' sections who purchase packets at 50 paise or Re 1.

"The impact would be disastrous. It would be a much more viable option for us to move out of the packet tea business altogether", said a number of the local players who spoke to The Financial Express.

An industry figure says that 45 per cent of the product from this segment goes into middle income homes, with monthly incomes of less than Rs 3,000. Smaller packs in the low priced segment (LUP) are very popular in slums, villages, rural areas and other interior regions across the country.

Out of almost 300 brands of packet tea in the domestic market, about 30-odd brands are active which include brands of major companies like HLL, Tata Tea, Duncan Industries, Goodricke Group, Eveready, and some strong regional players like Wagh Bakhri, Dhunseri Tea, Godfrey Philips etc.

The imposition of excise duty may call in for a sluggish growth in the current year for the packet tea producers. Industry sources said that the current governmentexercise would penalise value-addition, an innovative concept propagated by the industry for long and seen as the key to successful growth of the industry.

Price-realisation through a thrust on value-addition was one of the major business initiative of the tea industry, with the ad valorem tax, the difference between loose tea and packet teas will widen, which will squeeze profit margins, industry observers say.