Tata Consumer Products reported a nearly 28% year-on-year increase in consolidated net profit for the first quarter (Q1FY27), as improved operating margins and lower tea costs in India supported earnings
The company saw consolidated net profit touch Rs 427 crore in Q1 versus Rs 334 crore reported last year. Revenue for the quarter grew nearly 12% year-on-year to Rs 5,349 crore, with both figures coming in line with street estimates of Rs 432 crore and Rs 5,398 crore each.
Operating performance also improved during the quarter. Earnings before interest, tax, depreciation and amortisation (Ebitda) increased 19.3% to Rs 724 crore, up from Rs 607 crore a year ago, neaerly in line with Bloomberg’s consensus estimate of Rs 740 crore for the period.
The company’s Ebitda margins expanded to 13.5% from 12.7% in the year-ago period, broadly matching analysts’ expectations of 13.6% for the period.
Margin Expansion
Tata Consumer said the improvement in operating performance was primarily driven by lower tea costs in India, which helped offset the impact of elevated coffee prices in the US.
The company, however, continued to face inflationary pressure on several key input costs.
Brand Investments
It also said higher investments behind its brands weighed on costs during the quarter, reflecting its focus on strengthening market presence and supporting long-term growth.
Despite cost headwinds, sector analysts said the company delivered double-digit growth in revenue and profitability, with margin expansion highlighting improved operating leverage and favourable commodity costs in its India tea business.
“The India branded business delivered robust underlying volume growth reflecting continued focus on execution, category expansion and innovation. Our ‘Growth’ businesses performed very well and have scaled their overall contribution to the India business,” said Managing Director & CEO, Sunil D’Souza.
