Tata Starbucks said on Friday that it is fully committed to the Indian market, which is a key growth area for Starbucks globally.
Tata Consumer Products Ltd on Thursday termed as “baseless” reports suggesting that cafe chain Starbucks plans to exit the Indian market.
“Starbucks is fully committed to the Indian market. Any statements suggesting otherwise are false. Tata Starbucks currently operates over 470 stores across 76 cities in India, which continues to be a key growth market for Starbucks globally,” Tata Starbucks said.
Tata Starbucks is a 50:50 joint venture between Tata Group FMCG arm Tata Consumer Products Limited (TCPL) and US-based Starbucks Corporation, which operates the cafe chain under the Starbucks brand name in India.
Tata Starbucks revenue from operations rose 12% to Rs 1,218.06 crore in FY24. However, due to expansion, its loss during the period increased to Rs 79.97 crore from Rs 24.97 crore in FY23.
Its ad spend rose 26.8% to Rs 43.20 crore and royalties to Rs 86.15 crore, according to financial data accessed through business intelligence platform Toffler.
Last month, TCPL MD and CEO Sunil D’Souza told PTI that it will focus on scaling the Starbucks cafe chain here and is not looking at store profitability.
“With Starbucks, we are very clear that the profitability of the store is not an issue. And the way we scale, we know we can make a profit from it,” D’Souza had told PTI in the last week of November.
Starbucks was responding to reports suggesting that the US company plans to exit Indian operations due to high operating costs, mounting losses and the availability of cheaper local alternatives in the market.
Starbucks entered India in October 2012 through a joint venture with the Tata Group. The first Starbucks store in India was opened in Mumbai’s Elphinstone Building.