After commanding a leadership position in the tea segment, Tata Global Beverages Ltd (TGBL) is looking for acquisitions to strengthen its coffee business.

Ajoy Misra, who takes over as Managing Director and CEO of the Tata Group firm from April 1, said the company is looking to expand the coffee business either through acquisitions or by extending the existing brands both in India and overseas markets.

“World over, coffee growth is more than the tea and we are a small player in coffee. We are now looking at growing that market share. You will see more coffee play going ahead,” he told Business Line .

TGBL, a leader in the tea segment with brands like Tetley and Good Earth tea, has got a few coffee brands in India such as Coorg, Tata Coffee and Mr Bean.

However, while these brands have a dominant position in the southern market, they have been unable to take on Nescafe and Hindustan Unilever’s Bru at the national level.

Similarly, in the US, which is dominantly a coffee drinking nation, the company is witnessing a major challenge from local coffee players.

“The brand ‘Eight O clock’ is under pressure,” Misra said.

Meanwhile, TGBL has been pushing the coffee business through its joint venture with Starbucks in India.

“While coffee in India is seen mostly as out-of-home consumption beverage, we are also working towards strengthening the café business,” he added.

According to analysts, while the tea business posted a 16.6 per cent year-on-year growth in its profit, the coffee segment saw a 47 per cent contraction in profit.

On entering into other beverages, Misra said the focus for the next four-five years is on tea, coffee and functional water.

But the company is not ruling out possibilities of entering into pro-biotic milk or juices.

TGBL’s third quarter earnings were below the market estimates. The company posted an 8 per cent y-o-y- growth in its revenue at ₹2,057 crore, aided by good performance in some key markets and favourable foreign exchange translation impact.

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