Amidst speculations that Starbucks may exit the Indian market, Tata Consumer Products Ltd (TCPL), the company operating the café chain in India under a 50:50 joint venture with Starbucks Corporation, has quickly ruled out such rumors. It termed the claims as “baseless,” clarifying the future of the coffee giant’s presence in the country.
On Thursday, Tata Consumer Products dismissed rumors that Starbucks is leaving India. The speculations had created uncertainty by suggesting that Starbucks was planning to leave India because the operational costs are increasing and local competition is getting tougher with more affordable alternatives. Tata Consumer Products released a statement to clarify that claims were unsubstantiated, bringing a relief message to both customers and investors.
Tata Consumer Products’ Starbucks Expansion Plans
The joint venture between Tata Group and the US-based Starbucks Corporation has grown substantially since its inception in 2012. With 457 stores across 70 cities in India, Starbucks is now looking to expand further. The café chain plans to have 1,000 stores by fiscal year 2028, signaling continued growth despite the challenges it faces.
TCPL’s operating income increased by 12 percent to ₹1,218.06 crore in FY24 as part of its fiscal report. In a different context, the company declared a loss of ₹79.97 crore against ₹24.97 crore in FY23 primarily in the pursuit of expansion.
Not Focusing On Profit Of Stores
TCPL MD & CEO Sunil D’souza recently spoke on how the company would view long-term strategy for Starbucks over an interview last month. He said profitability at the store level was not a concern at this stage. “With Starbucks, we are very clear that the store profitability is not an issue.
And as we get to scale, we know that we can generate profits out of it,” D’souza said. His comments mirrored the company’s focus on scaling up operations, with a belief that profits will follow as the brand becomes more entrenched in the market.
Starbucks entered the Indian market in October 2012 through a joint venture with the Tata Group, marking its first expansion into the subcontinent. The first Starbucks store in India was opened in Mumbai’s iconic Elphinstone Building, setting the stage for the brand’s successful venture in the country.
Since then, Starbucks has built a loyal customer base, establishing itself as the leading café chain in India, even as it faces competition from local players.
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