Tata Tea is bullish about increasing its presence in Pakistan and Bangladesh as the two countries have significant per capita consumption of tea, with Pakistan having the third largest consumption in the world.
Pakistan, mainly a CTC tea consuming country, consumes 160 million kgs of tea annually and is largely catered to by African countries like Kenya. Although there were efforts from the Tea Board of India to serve such a large tea consuming population, the Indian crop is yet to capture significant share in the market. Legal import of tea into the country is around 107 mkgs.
Tata Tea, which forayed into Pakistan a few years back, is trying to bring stability into the business in the country. ?We are looking at increasing our market share from 7% at present to 10% in Pakistan,? said Sangeeta Talwar, executive director, Tata Tea.
With a per capita tea consumption of one kilo, branded tea in Pakistan is around 75% of the legal tea imports into the country. Even if illegal trade is taken into consideration, branded tea trade in the country is almost half the business. This has opened up huge opportunities for companies like Tata Tea into the neighbouring country.
On the other hand, tea market in Bangladesh is around 45 mkgs per year where Tata Tea has a mere 5% market share. ?We have just started making our presence in the tea business in these two countries. We need to go beyond the 10% market share in these two countries which will take around two years,? she said. Talwar was present in Kolkata to promote Tata Tea Jaago Re Soccer Stars-round 3.
Tata Tea has started increasing its point of sales in these two countries and is planning to launch other value-added products after it gets 10% market share there. ?We have very small presence in Pakistan and Bangladesh but we have good joint venture partners there. We are now building our business in a way that we can really leapfrog our growth there,? she said. Apart from enhancing distribution in these two countries, Tata Tea is also looking into new packaging and value formats keeping specific demands of the customer in mind.
Meanwhile, the company is looking at garnering half of its business from non-tea business in future. Almost 90% of its sales at present come from tea and coffee business, while 85% from tea alone.