Tata Consumer Products released its fourth-quarter financial results for FY24, showing a 19.3% decline in net profit to Rs 217 crore. Despite this decrease, the company experienced an 8.5% growth in consolidated revenue from operations, reaching Rs 3,927 crore. Let’s delve deeper into the performance metrics and key highlights from the report.
Net Profit and Revenue Analysis
The reported net profit of Rs 217 crore marks a significant drop from Rs 269 crore in the same quarter of the previous year (Q4FY23). However, the company witnessed a notable increase in revenue from operations, which stood at Rs 3,619 crore in Q4FY23, indicating an upward trajectory despite the profit decline.
Ebitda and Expenses
Tata Consumer Products reported an Ebitda of Rs 631 crore for Q4FY24, up 22% from the previous year. This positive trend in Ebitda continued for the entire fiscal year, with a 24% increase to Rs 2,323 crore. However, total expenses rose by 7.4% year-on-year to Rs 3,456 crore, affecting the bottom line.
Sequential Performance
Sequentially, net profit fell by 22% from the previous quarter (Q3), while revenue saw a marginal increase of 1.65%. Expenses also went up by 3.1% quarter-on-quarter, indicating challenges in cost management.
FY24 Performance
For the full fiscal year 2024, Tata Consumer Products reported a 4.4% drop in net profit, totaling Rs 1,150 crore. Despite this, total revenue increased by 10.3% to Rs 15,206 crore. Expenses also rose by 9% year-on-year, reaching Rs 13,429 crore.
Segment Performance and International Business
The company noted that premium and sub-premium segments outperformed the overall business, contributing to over two-thirds of India Tea revenue. Internationally, Tata Consumer Products saw a 7% growth, with improved profitability. In the UK, the company gained market share across major retail partners, while in the US, Tata Raasa entered 100 Stop & Shop stores during Q4.
MD’s Comments and Future Outlook
Sunil D’Souza, MD, and CEO of Tata Consumer Products, expressed satisfaction with the premiumization agenda’s progress and highlighted strong growth in premium portfolios. He also mentioned the positive performance of growth businesses like Tata Sampann, RTD, Tata Soulfull, and Tata SmartFoodz, which saw a 40% revenue increase in FY24. D’Souza emphasized the value creation potential of recent acquisitions, Capital Foods and Organic India, and the company’s focus on their integration.
Dividend Payment and Stock Performance
Tata Consumer Products Ltd recommended a dividend payment of Rs 7.75 per share. Despite the Q4 results, the company’s shares closed at Rs 1,173.25, indicating investor confidence.
In conclusion, while Tata Consumer Products faced a decline in net profit, its revenue and Ebitda showed positive growth trends. With a focus on premiumization, international expansion, and recent acquisitions, the company aims to unlock further value in the coming quarters.
