Tata Group plans to re-enter the FMCG business nearly after three decades in the personal and home care categories competing against Hindustan Unilever (HUL). Group company Tata Global Beverages is set to transform itself to become a broadbased consumer products enterprise. It is expected to house the consumer products of personal care, home care, dairy and nutri-supplements in addition to its existing categories of beverages, spices, staples and packaged foods. This will make Tata Global a formidable rival to HUL and ITC, which have multi-category fast moving consumer goods (FMCG) products.
In its first phase, Tata Global will be taking over the food (salt, spices, proteins, snacks, sweeteners) and non-food (detergents) business of Tata Chemicals to create an enterprise with a turnover of £909.9 million. Tata Chem had recently forayed into home care with the pilot launch of Tata DX detergent in West Bengal.
Once the acquisition is completed, the company will be renamed as Tata Consumer Products (TCP) to reflect the wider and changing profile of Tata Global. The management declared that TCP will be the vehicle for the group’s longer term and broader FMCG play. Tata Global considers this consolidation an entry into high-growth, high-margin categories such as home care, personal care and dairy organically or inorganically.
Expecting to piggyback on the vast distribution reach of Tata Chem, TCP plans to double its reach to 2.5 million retail outlets and 200 million households in the country. A billion Tata Salt packs were sold in fiscal 2019 - similar to the size of the Indian population.
In 1993, HUL (then Hindustan Lever) acquired the erstwhile Tata Oil Mill Company (TOMCO). Before that, with brands like Hamam, Moti, 501and OK, it was the second-largest soap maker in the country. In order to focus on its commodity businesses like steel, the conglomerate exited from the space. Now, the group intends to grow its consumer-facing business and increase revenue share from branded play as against the commodity business. Tata Group company Titan already has a fragrance called ‘Skinn’. Some years ago, Titan had expanded its object clause to include cosmetics. Another group company Trent sells its own range of make-up products at its Westside departmental stores.
