- Tata Starbucks is a joint venture between the Tata Group and Starbucks in India.
- The Joint Venture reported a net profit of Rs 29 crore for the fiscal year 2018-19.
- This comes after 6 years of its first outlet launch in India in 2012.
The Joint Venture reported a net profit of Rs 29 crore for the fiscal year 2018-19, information from Tofler’s research platform showed.
It had a net loss of Rs 30 crore in the past year. The profit of the FY19, however, included an exceptional deferred tax item of Rs 75 crore, which helped the bottom line of the company. At the operational stage, the prior tax loss of the company has increased by 50% to 46 crores.
Starbucks’ Indian unit extended revenues by 30% in FY19 to 447 Rs crores, paced by the addition of fresh stores in Indian metro cities with an increased demand for quality beverages. Sales development, however, slowed in the quarter ended June to 23 percent.
Tata Global Beverages believes it now has a set template for expansion in this segment and will be able to continue with the momentum. Focus on driving foods part of the offering continues to remain strong,” said a recent investors’ note by Kotak Institutional Equities Research.
Tata Starbucks added about 30 outlets in the last fiscal year, bringing the count of the shop to 157.
Starbucks, which launched its India operations in October 2012, recorded the fastest store expansion in the 48-year history of the company in the county in the first few years. But with 1,750 shops, rival Cafe Coffee Day remains the market leader in the cafe segment.
Additionally, each Starbucks outlet was a generating a revenue of about Rs 3 crore on an average, lower than Westlife Development, running McDonald’s in eastern and western India and clocking more than Rs 4.6 crores of revenue at each outlet. In the rapid restaurant space, Burger King too outsold Starbucks in FY18 after entering the country four years ago.
With the recent profits, Starbucks is looking solid in the quick restaurant space and looks to double the profits with every passing year onwards.