It Was A Good Quarter For Us, With 18% Topline Growth & Strong Volume: Tata Consumer Products

So Mangalam, thanks for having me. Yes, we've had a good quarter, 18% topline volume growth across all the different segments, and margins coming back. Specifically coming to tea, last year tea prices, because of the supply-demand mismatch, had gone up by about 30%. And it was our estimation that about 20% will come off and 10% will continue to remain there. And broadly that is what we're seeing out in the market. Now I wouldn't read too much into a month-on-month movement on tea prices. Overall, we expect tea prices to be broadly benign from here on. In the tea business, we operate in gross margins of between a 34 to a 36 sort of number. And the reason for that is over time we figured out as long as we're operating in that number, we continue to gain market share, especially from the loose, local, regional players which are around in a commodity business. Right now we're operating in that space, we've delivered 5% volume growth and 12% topline, so we're comfortable with pricing where it is right now, budgeting for roughly benign prices.

So roughly we have said that we'll grow EBITDA margins and we should be coming back to the 15 range by the end of Q4, and there's no reason for us to change that. We came in at a 13.6 this quarter. This quarter was impacted primarily by the US coffee prices, so to speak, primarily because of two things: coffee prices have gone up and on top of that the 50% tariffs from Brazil, and Brazil accounts for roughly 30% of the mix for us as well as for the industry in the US. If I add that back, we're in the 14.6, 14.7 range. So we're touching 15. We have degrammed in the US in November. We've announced a price increase earlier in July. We've announced one more in January. So we hope to get the US margins back on track, basis which we will be broadly on a 15 or thereabouts EBITDA margin by Q4.

Salt market right now we're touching about 40. The good part is we've got to balance both market share and volume growth, right? Salt, we had good volume growth this quarter. We had good margin growth. And we aim to be 40 or thereabouts longer term period. We have higher ambitions in salt because we've got a full play right from solar up to rock salt, all the different price-value equations straddled. In tea, we are a 20-22 share player. We continue to grow volume and value consistently. Now there's one thing you got to remember in tea is a significant portion of the business has now shifted to quick commerce, e-commerce, and which channels are not consolidated by Nielsen today, as well as in modern trade which is now roughly 15-16% of my business. One of the big players doesn't share numbers with Nielsen and it's an estimate. So Nielsen numbers for market share we would look at broadly from a directional perspective, not an absolute number.