Tata Consumer Products Ltd is going to launch American gourmet coffee brand Eight O’Clock in India next week, 15 years after it acquired the business in the US. TCPL will sell the coffee directly to consumers in India, who can place orders online and get them delivered home.
The Tatas had bought the company, the fourth largest in the roasted and grounded category of coffee in the US, for about Rs 1,015 crore from Gryphon Investors in 2006. Apart from the US, the 102-year old Eight O’Clock coffee brand is also available in Canada and Europe.
This is the second premium coffee brand launched by TCPL, which has brought Starbucks to India through a joint venture, as it plans to strengthen its presence in the coffee market in India.
“I am happy to say that Eight O’Clock coffee will be launched in the D2C (direct-to-consumer) segment next week,” Natarajan Chandrasekaran, chairman of Tata Sons and TCPL, told shareholders at the 58th annual general meeting.
The coffee business in the US grew 7 per cent in volume and 9 per cent in value (constant currency) in 2020-21, Sunil D’Souza, managing director & CEO of the company, later said. Eight O’clock Coffee Ltd, USA had reported a revenue of Rs 1,293 crore in the last fiscal and a profit of Rs 145 crore. The USA is the largest coffee market in the world, estimated at $11 billion.
Earlier this year, TCPL launched Sonnets by Tata Coffee, a premium range of roast and ground coffee, again in the D2C segment.
Responding to a shareholder on the way forward in coffee, the chairman said: “In all our portfolio we are really pushing (for) very strong distribution and market share gain, you are already seeing market share gain in tea and coffee is a long way to go but there is a big opportunity. We will definitely look at significant growth in this segment.”
Food and beverages, which primarily include tea, are two of the strong pillars for TCPL which took over the consumer facing businesses of Tata Chemicals two years ago. Apart from salt, its portfolio now includes pulses, spices, ready-to-cook items, mineral water, and breakfast cereals.
“When we did the integration we had committed synergies of Rs 100-150 crore in 18-24 months. We remain well on track to meet, if not exceed, the quantum and the timing of the synergies that we committed,” D’Souza said during the meeting.
