Starbucks, the globally renowned coffee chain, made its Indian debut in October 2012 through a joint venture (JV) with the Tata Group, forming Tata Starbucks Limited. The first Starbucks outlet opened in Mumbai’s Elphinstone Building, beginning a successful partnership.
Recently, speculation arose suggesting Starbucks might end its 12-year-old JV with Tata Group. These rumors gained traction, especially following the passing of Tata Group patriarch Ratan Tata. However, Tata Consumer Products Limited (TCPL) firmly denied these claims, calling them “completely false and baseless” in a statement to CNBC-TV18 on December 19.
Strong Partnership and Continued Growth
The partnership between Tata and Starbucks remains robust, underpinned by shared values and a deep commitment to the Indian market. Tata Starbucks currently operates over 450 outlets across 70 cities in India, making it the country’s leading café chain under the Starbucks brand. The company has ambitious plans to expand its footprint to 1,000 stores by FY28.
Financial Performance and Expansion
In FY24, Tata Starbucks reported a 12% rise in revenue to ₹1,218.06 crore, but its losses widened to ₹79.97 crore, up from ₹24.97 crore in FY23, primarily due to aggressive expansion. Advertising expenses increased by 26.8% to ₹43.20 crore, while royalty payments reached ₹86.15 crore. Despite these challenges, TCPL MD & CEO Sunil D’souza expressed confidence in the venture, stating that profitability will improve as the scale of operations grows.
Dismissing Speculation
The rumors of Starbucks exiting India stemmed from concerns about high operating costs, mounting losses, and competition from local alternatives. Addressing these reports, TCPL reiterated its commitment to the Starbucks brand and confirmed there is no plan to end the JV.
The Tata-Starbucks partnership continues to thrive, proving that the speculation was unfounded. Both companies remain focused on scaling their operations and strengthening their presence in the Indian market.
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