According to reports from Moneycontrol and NDTV, Tata Consumer Products Limited chairman N Chandrasekaran outlined the company's strategic approach to drive growth during the 63rd annual general meeting held on Wednesday. The fast-moving consumer goods firm will pursue a combination of volume-led growth and selective price increases to expand its business, with the company very clear that volume growth is important because it cannot deliver growth only based on pricing. As reported by NDTV, profitability will improve through better product mix, higher volumes and contributions from newly launched categories. The company emphasized that volume growth remains a key priority even as it undertakes selective price hikes to mitigate the impact of rising input costs, with price increases becoming necessary when commodity costs rise sharply.
As reported by Moneycontrol and NDTV, innovation currently contributes 4.5 percent of the firm's sales, with plans to increase this contribution to 5 percent. The company's R&D expenses currently amount to 0.5 percent of sales, approximately ₹70 crores, and management indicated continued investment in research and development activities. According to NDTV, the company launched around 80 products during the year, demonstrating a balanced approach to growth through both organic and inorganic expansion. The innovation strategy remains a key growth lever as the company continues to add to its portfolio through both internal development and strategic acquisitions.
According to Moneycontrol and NDTV, the company will continue to assess acquisition opportunities as part of its strategy to elevate its product mix and portfolio. The acquisitions are characterized as high-margin businesses, operating at 48 percent gross margins compared to 35-36 percent gross margins of the remaining portfolio. As reported by NDTV, the company's three major acquisitions - Organic India, Capital Foods, and Soulful - are targeted to achieve 25 percent year-on-year growth rates. The acquisitions are expected to contribute significantly to the company's margin improvement strategy, with the management and board conscious of ensuring recent acquisitions generate strong growth and adequate returns on the capital invested. The company plans to increase margins in its growth businesses, which include Tata Sampann, Capital Foods, Organic India, NourishCo, and Tata Soulfull, which have been growing at 24 percent.
As reported by Moneycontrol and NDTV, addressing shareholder concerns about current EBITDA margins of 14.1 percent, chairman N Chandrasekaran acknowledged that while margins have been increasing sequentially, there has been some impact from supply chain issues and commodity price increases. The company expects 50 basis points improvement on margins in a typical year and 100 basis points improvement in favorable market conditions. The management emphasized that margin improvement will be driven through both organic growth initiatives and strategic acquisitions, with adverse factors such as supply chain disruptions and commodity inflation, particularly in categories like tea where the company has significant exposure, impacting profitability. The company's growth businesses, including Tata Sampann, Capital Foods, Organic India, NourishCo, and Tata Soulfull, are planned to increase their margins as part of the overall margin improvement strategy.
According to NDTV, the company will ramp up its allocation for capital expenditure to ₹700 crores this year as part of its growth strategy. The management expressed confidence in the company's ability to achieve its margin targets through continued focus on innovation, strategic acquisitions, and operational excellence. The company, known for brands like Tata Salt and Himalayan water, has crossed the ₹20,000 crore revenue mark in 2026 and is being built as a diversified FMCG player with a long-term perspective. As reported by NDTV, the company is being transformed from a beverage company focused predominantly on tea and coffee to a truly diversified food products and beverages FMCG company, adding to its portfolio through both organic and inorganic expansion initiatives while maintaining its commitment to volume-driven growth.
