In a bid to strengthen its “living essentials” consumer segment, Tata Chemicals Limited is focusing on high margin value-added staples and nutritional supplements.
This quarter, it launched a low calorie sweetener named Tata Nx. The brand is currently available in two variants i.e. “Zero Sugar” and “Lite and Sweet”, which has 50% less calories. Both products are made with stevia leaves, a common substitute for sugar.
“Tata Nx will only be available in Godrej Nature’s Basket in physical retail, and we may enter Star Bazaar soon,” managing director and chief executive R. Mukundan said at a press briefing, according to a news source adding that this segment was a high margin one in the consumer business.
“In the investment plans we have, half is allocated for the nutraceuticals facility,” Mukundan said.
The company said it was investing Rs565 crore in expanding its manufacturing facilities. Of this, half would be in a facility devoted to making nutraceuticals in Nellore, Andhra Pradesh.
The company is moving its brand Tata Sampann into value added dry staples, including mixes such as an instant pakoda mix, an extension of the Sampann chickpea flour brand that is marketed as a “Low Oil Absorb” product for healthier eating.
Tata Chemicals is also looking to launch a range of spices to be sold under the Sampann brand name in south India by the end of this year, Mukundan said.
Tata Chemicals will see most of its growth from three areas, the analyst said – specialty silica, consumer business (including nutraceuticals), and the agri-inputs subsidiary Rallis India Limited.
Tata Chemicals posted a 31.8% rise in net profit to Rs343.02 crore for the quarter ending March 2017, partly because it discontinued operations of its urea business which will be sold to Yara Fertilizers. The discontinuation brought the company a Rs. 62.56 crore exceptional gain in profit after tax.
The company saw a 14.8% decline in consolidated revenue to Rs. 3,097.47 crore in the same period because it discontinued manufacture of urea at its Babrala plant in Uttar Pradesh, the company said in a stock exchange filing.