Tata Consumer Products Ltd (TCPL) dismissed reports on Thursday claiming that Starbucks was planning to exit the Indian market, calling them “unfounded.”
The Tata Group, in a 50:50 joint venture with US-based Starbucks Corporation, operates Starbucks cafés in India, where the brand remains the dominant café chain.
The State of Starbucks in India
As of the end of September, Starbucks had 457 stores across 70 cities in India and aims to expand this number to 1,000 by FY28. For the fiscal year 2024, the company reported a 12% increase in revenue from operations, reaching Rs 1,218.06 crore. However, its losses widened to Rs 79.97 crore from Rs 24.97 crore in FY23, primarily due to its aggressive expansion strategy.
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In terms of marketing, Starbucks saw a 26.8% rise in promotional expenses, totaling Rs 43.20 crore, while royalty payments amounted to Rs 86.15 crore, according to financial data from the business intelligence platform Tofler.
Reports of Starbucks Leaving India
These reports of Starbucks potentially leaving the Indian market came after speculation about high operating costs, mounting losses, and competition from cheaper local alternatives. In response, TCPL issued a regulatory filing on Thursday, firmly denying the claims as “baseless.”
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Starbucks entered the Indian market in October 2012 through its joint venture with Tata Group, with its first store opening in the Elphinstone Building in Mumbai.
