Oct 26 (Reuters) - India's Tata Consumer Products reported a better-than-expected second-quarter profit on Monday, helped by strong growth in its packaged foods and beverages businesses, even as demand for tea remained subdued.
The maker of Tata Salt and Tetley tea posted a consolidated net profit of 4.69 billion rupees ($49.26 million) for the quarter ended September 30, compared with 4.04 billion rupees a year earlier.
Analysts, on average, had expected a profit of 4.66 billion rupees, according to data compiled by LSEG.
Tata Consumer, which competes with Hindustan Unilever in tea and Nestle India and ITC in parts of the packaged foods market, has been expanding into higher-growth categories, including convenience foods, health-focused products and ready-to-drink beverages.
Revenue from operations rose 14% to 56.61 billion rupees, compared with analysts' expectations of 55.84 billion rupees.
Tata Consumer's growth businesses, including Tata Sampann packaged foods, NourishCo beverages, Capital Foods and Organic India, recorded a 40% rise in revenue and accounted for 38% of its India business during the quarter.
Salt revenue rose 15%, supported by 9% volume growth amid price increases. However, domestic tea and coffee revenue declined 1% as tea volumes remained flat.
Indian consumer goods makers have benefited from steady demand and price increases while higher raw material costs have pressured profitability.
Tata Consumer's EBITDA margin widened about 40 bps to 14%, as improved operating performance in its international and non-branded businesses partly offset higher input costs in India.
The company's international business revenue grew 7%, although it declined 2% in constant-currency terms, as a prolonged heatwave weighed on tea consumption in Britain.
Tata Consumer Products is part of Tata Group, which is caught in a power struggle over control of the holding company and whether it should go public.
Shares of the company closed down 2.84% on Monday.
($1 = 95.2100 Indian rupees)
Reporting by Surbhi Misra in Bengaluru; Editing by Harikrishnan Nair
Source: Reuters