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TATACONS’s FY23 annual report focuses on the management’s strategic initiatives to strengthen its foundation by expanding its distribution reach and presence, accelerating growth through portfolio expansion, exploring new opportunities, and placing emphasis on innovation. The key takeaways are:

* The Indian growth business grew 53% YoY, led by robust growth of 80% YoY in NourishCo. Tata Sampann grew ~29% YoY, while Tata Soulfull has doubled its revenue during the year.

* The direct distribution network of the company has tripled to ~1.5m outlets in FY23 from ~0.5m in 2020, while the total reach has expanded to ~3.8m outlets. Modern Trade/ Ecommerce accounts for ~14%/9% of India business in FY23.

* TATACONS is focusing on five key platforms (Current core, pantry, liquids, mini meals, and protein) to expand its total addressable market in a bid to become a formidable FMCG player. In FY23, the company has doubled its launches, reaching ~34 new products. Further, it possesses the necessary infrastructure to launch ~200 new products annually.

* In FY23, the International business grew in high single digits. However, owing to input cost inflation and adverse currency movements, the company’s profitability was severely impacted. TATACONS has taken corrective price actions and implemented structural cost-saving changes, resulting in sequential margin improvement.

India growth businesses leading from the front

* TATACONS has yielded remarkable success from its growth businesses (which include NourishCo, Tata Sampann, Tata Soulfull and Tata Smartfoodz), registering 53% YoY growth in FY23 and now contribute ~15% to the total India business of TATACONS. It is further expanding its portfolio by adding new vectors of growth in order to sustain the robust growth trajectory.

* NourishCo: FY23 was a landmark year for NourishCo, wherein its revenue grew 80% YoY to INR6.2b, led by Tata Copper plus (up 2.1x YoY) and Himalayan water (up 85% YoY).

* NourishCo witnessed robust growth, driven by several factors in FY23. The introduction of new products played a significant role, contributing ~13% to the business. Additionally, the company is focused on expanding its capacity through co-packers. NourishCo achieved rapid expansion in distribution coverage reaching ~0.65m outlets (up 43% YoY).

* TATACONS has further doubled up its capacity in the segment to support the robust growth trajectory in the segment.

* Himalayan brand has turned profitable, enabling extension into premium preserves and honey. The company also launched Tata Fruski Juice n Jelly, a juice-based drink with the added surprise of Jelly.

* Tata Sampann portfolio delivered strong growth of 29% YoY, with broadbased performance across and staples and dry fruits. The dry fruits segment grew robustly, on the back of new product launches and higher SKUs; gaining market share across e-commerce platforms.

* TATACONS has entered South market for spices (~INR600b market pan India) with a range of pure and blended spices specially curated for South Indian palate. It also expanded into high-value spices with the launch of Asafoetida (Hing).

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