Tea in India
Euromonitor International
February 2024
TEA IN INDIA Passport i
LIST OF CONTENTS AND TABLES
KEY DATA FINDINGS.................................................................................................................. 1
2023 DEVELOPMENTS ............................................................................................................... 1
Prominent companies focus on hyperlocal strategies to cater to a diverse range of customers1
Tea, being an agricultural commodity, faces varied macroeconomic challenges, leading to
downtrading .............................................................................................................................. 1
Companies continue to leverage the power of social media for their premium product
assortments .............................................................................................................................. 2
PROSPECTS AND OPPORTUNITIES......................................................................................... 2
Hindustan unilever’s new margin model is not received favourably by distributors and may
hamper its share ....................................................................................................................... 2
Prominent players focus on health and wellness and newer markets as growth options in the
forecast period .......................................................................................................................... 2
Dabur’s foray into the tea market bodes well for a category which was beginning to look
somewhat consolidated due to a lack of pan-india players ....................................................... 3
CATEGORY DATA ....................................................................................................................... 3
Table 1 Retail Sales of Tea by Category: Volume 2018-2023................................... 3
Table 2 Retail Sales of Tea by Category: Value 2018-2023 ..................................... 3
Table 3 Retail Sales of Tea by Category: % Volume Growth 2018-2023 .................. 3
Table 4 Retail Sales of Tea by Category: % Value Growth 2018-2023 ..................... 4
Table 5 NBO Company Shares of Tea: % Retail Value 2019-2023 .......................... 4
Table 6 LBN Brand Shares of Tea: % Retail Value 2020-2023 ................................. 4
Table 7 Forecast Retail Sales of Tea by Category: Volume 2023-2028.................... 5
Table 8 Forecast Retail Sales of Tea by Category: Value 2023-2028....................... 5
Table 9 Forecast Retail Sales of Tea by Category: % Volume Growth 2023-
2028 ............................................................................................................. 6
Table 10 Forecast Retail Sales of Tea by Category: % Value Growth 2023-
2028 ............................................................................................................. 6
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TEA IN INDIA Passport 1
TEA IN INDIA
KEY DATA FINDINGS
▪ Retail value sales grow by 11% in current terms in 2023 to INR239 billion
▪ Green tea is the best performing category in 2023, with retail value sales rising by 21% in
current terms to INR68.4 billion
▪ Tata Consumer Products Ltd is the leading player in 2023, with a retail value share of 29%
▪ Retail sales are set to rise at a current value CAGR of 12% (2023 constant value CAGR of
7%) over the forecast period to INR416 billion
2023 DEVELOPMENTS
Prominent companies focus on hyperlocal strategies to cater to a
diverse range of customers
India, a vast and diverse country, has seen leading players adapting to its rich tapestry by
offering diverse products and tailored marketing strategies to meet the preferences of its
consumers. Notably, Tata Consumer Products and Hindustan Unilever have embraced a
hyperlocal approach. Tata Consumer Products, for instance, established an R&D centre
dedicated to new product development, aligning its innovation pipeline with the untapped
opportunities in the Indian market. In 2023, it introduced Tata Tea Premium Tea Chais, featuring
four variants that celebrate the unique taste and flavour profiles of local teas in Mumbai,
Kolkata, Delhi, and Hyderabad. Launched at Delhi Metro, the product's packaging is thoughtfully
designed to resonate with the regional connection and vibrancy of each city, establishing a
strong sense of place.
On the other hand, Hindustan Unilever adopts the "Winning in Many Indias" model,
recognising India as 15 distinct clusters rather than a homogeneous entity, given the country's
vast scale and diversity. This approach influences both product development and hyperlocal
marketing initiatives. In 2023, Hindustan Unilever revamped Lipton Green Tea by reformulating
its tasting blend, aligning with its commitment to meeting the diverse preferences within the
Indian market.
Tea, being an agricultural commodity, faces varied macroeconomic
challenges, leading to downtrading
India, a nation favouring tea consumption, primarily relies on domestically-produced tea. The
anticipated domestic tea production for 2023 is projected to be approximately 1.4 million tonnes,
mirroring the previous year's figures, as reported by Tea Board India. About 30-35% of this
consumption is attributed to unbranded products in terms of volume. Inflation has exacerbated
challenges for tea manufacturers by increasing costs. Boiled milk tea constitutes a substantial
portion of tea consumption in India, making milk a significant factor in the overall consumer
price. In the first half of 2023, the average retail price of milk experienced a 12% surge
compared to 2022, leading to higher end-cup costs for consumers and inflated manufacturing
expenses. Consequently, due to these factors, there is a heightened demand for economy and
mid-priced tea brands. Exports are expected to decline, and Iran, Russia, and the United Arab
Emirates are expected to purchase a lower amount for many reasons, including inflation and
conflicts.
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TEA IN INDIA Passport 2
Companies continue to leverage the power of social media for their
premium product assortments
More prominent companies such as Tata Consumer Products and Hindustan Unilever have
identified this white space and promptly launched products. Companies are also leveraging the
power of social media to understand the demand for these premium products. Companies
monitor direct messages and comments to understand the white space and launch products
accordingly. Social media platforms also enable companies to conduct polls, which is a quick
and real-time way to understand consumer preferences. These strategies help them maintain an
attractive product assortment. The margins involved allow companies to take a D2C route for
these products while competing with fledgling D2C brands. Also, the online channel is better
suited to test-market their new product developments. Therefore, social media platforms will
continue to be an essential tool for companies in tea in the forecast period.
PROSPECTS AND OPPORTUNITIES
Hindustan unilever’s new margin model is not received favourably by
distributors and may hamper its share
In 2023, the rural regions witnessed a slowdown in demand. As a result, companies created
new models and strategies. Hindustan Unilever has restructured its margin model in partnership
with distributors, giving greater importance to target-linked variable margins over fixed margins.
Initially implemented in the top 100 cities, the objective is to encourage distributors to focus on
premium product lines and extend product availability to new retail outlets. However, the All
India Consumer Products Distributors Federation (AICPDF) is dissatisfied with the current
model and urges the company to return to the previous one.
Meanwhile, in Maharashtra, the Maharashtra Consumer Products Distributors Federation
(MSCPDF) is considering a potential boycott of three Hindustan Unilever brands across various
product categories, including the popular tea brand, Taj Mahal. The distributors are advocating
for a bare margin of 5% as part of the incentive structure. If Hindustan Unilever remains
unyielding to their demands, the association may contemplate a nationwide boycott of its
brands, posing a potential threat to its market share in 2024.
Prominent players focus on health and wellness and newer markets as
growth options in the forecast period
Major industry players consistently explore avenues for inorganic growth to strengthen their
presence in India and introduce new products globally. By the end of 2022, Tata Consumer
Products and Hindustan Unilever were discussing acquiring Girnar Food & Beverages.
However, for various reasons, neither company proceeded with the acquisition.
The landscape of fmcg categories underwent a significant transformation due to COVID-19,
with a heightened focus on health and wellness among Indian consumers. In January 2024,
Tata Consumer Products revealed its intention to acquire Organic India, a prominent player
known for offering better for you tea and other products. This strategic move aims to solidify the
company's position in the tea market by expanding its portfolio with organic and healthier
brands. The acquisition is also expected to open up new markets and channels while enhancing
operational efficiencies in the supply chain.
© Euromonitor International
TEA IN INDIA Passport 3
Dabur’s foray into the tea market bodes well for a category which was
beginning to look somewhat consolidated due to a lack of pan-india
players
Towards the conclusion of 2022, Dabur introduced Dabur Vedic Tea, an upscale tea brand
offering three different sizes: 100g, 250g, and 500g, with a primary emphasis on health benefits
in its promotional campaigns. The potential acquisition of Organic India by Tata Consumer
Products leaves Dabur with limited competition, except Gujarat Tea Processors & Packers.
However, the latter faces challenges in expanding to new states, mainly due to the considerable
time it takes. Wagh Bakri, its leading brand, primarily concentrated in central and western India,
is gradually expanding its nationwide presence, albeit not rapidly. The company adopts a state-
by-state approach, focusing on one or two states at a time and opting for sequential rather than
simultaneous expansion. This strategy only involves moving to another state after securing a
substantial market share. With over a century of experience and a solid financial foundation,
Dabur is well equipped to challenge and compete with more prominent players if its tea brand
gains acceptance in the market.
CATEGORY DATA
Table 1 Retail Sales of Tea by Category: Volume 2018-2023
Tonnes
2018 2019 2020 2021 2022 2023
Tea 346,336.3 361,498.9 387,748.4 402,126.2 419,570.8 436,050.7
Black Tea 336,001.7 348,704.7 370,316.3 382,759.7 397,033.2 409,839.3
- Loose Black Tea 332,075.4 344,362.1 365,318.9 377,447.4 391,208.2 403,254.8
- Tea Bags Black 3,926.4 4,342.6 4,997.4 5,312.3 5,824.9 6,584.5
Fruit/Herbal Tea - - - - - -
Green Tea 10,334.6 12,794.2 17,432.1 19,366.5 22,537.6 26,211.4
Instant Tea - - - - - -
Other Tea - - - - - -
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources
Table 2 Retail Sales of Tea by Category: Value 2018-2023
INR million
2018 2019 2020 2021 2022 2023
Tea 142,501.7 155,121.2 177,438.2 191,833.6 214,748.8 238,479.3
Black Tea 120,303.4 126,578.0 137,151.9 145,457.4 158,273.2 170,119.3
- Loose Black Tea 116,198.4 121,881.7 131,537.3 139,214.1 150,988.1 161,431.9
- Tea Bags Black 4,105.0 4,696.4 5,614.7 6,243.3 7,285.1 8,687.4
Fruit/Herbal Tea - - - - - -
Green Tea 22,198.4 28,543.1 40,286.2 46,376.3 56,475.6 68,360.1
Instant Tea - - - - - -
Other Tea - - - - - -
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources
Table 3 Retail Sales of Tea by Category: % Volume Growth 2018-2023
© Euromonitor International
TEA IN INDIA Passport 4
% volume growth
2022/23 2018-23 CAGR 2018/23 Total
Tea 3.9 4.7 25.9
Black Tea 3.2 4.1 22.0
- Loose Black Tea 3.1 4.0 21.4
- Tea Bags Black 13.0 10.9 67.7
Fruit/Herbal Tea - - -
Green Tea 16.3 20.5 153.6
Instant Tea - - -
Other Tea - - -
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources
Table 4 Retail Sales of Tea by Category: % Value Growth 2018-2023
% current value growth
2022/23 2018-23 CAGR 2018/23 Total
Tea 11.1 10.8 67.4
Black Tea 7.5 7.2 41.4
- Loose Black Tea 6.9 6.8 38.9
- Tea Bags Black 19.2 16.2 111.6
Fruit/Herbal Tea - - -
Green Tea 21.0 25.2 208.0
Instant Tea - - -
Other Tea - - -
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources
Table 5 NBO Company Shares of Tea: % Retail Value 2019-2023
% retail value rsp
Company 2019 2020 2021 2022 2023
Tata Consumer Products Ltd - 28.7 28.5 28.5 29.3
Hindustan Unilever Ltd 28.2 28.0 27.9 27.3 27.8
Wagh Bakri Ltd 7.3 6.9 7.4 7.6 7.4
Twinings Pvt Ltd 2.2 2.2 2.1 2.1 2.0
Amar Tea Pvt Ltd 1.7 1.6 1.6 1.5 1.4
Goodricke Group Ltd 1.7 1.5 1.5 1.4 1.4
Cosmic Nutracos Solutions 0.9 1.2 1.2 1.2 1.2
Pvt Ltd
Girnar Food & Beverages 1.0 0.9 0.9 0.8 0.8
Pvt Ltd
Duncans Industries Ltd 0.4 0.4 0.4 0.3 0.3
Tata Global Beverages Ltd 28.7 - - - -
Private Label 3.0 2.8 2.8 2.7 2.6
Others 24.9 25.8 25.7 26.5 25.9
Total 100.0 100.0 100.0 100.0 100.0
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources
Table 6 LBN Brand Shares of Tea: % Retail Value 2020-2023
© Euromonitor International
TEA IN INDIA Passport 5
% retail value rsp
Brand (GBO) Company (NBO) 2020 2021 2022 2023
Tata Tea Tata Consumer Products Ltd 19.7 19.2 18.6 18.4
Brooke Bond (Unilever Hindustan Unilever Ltd 11.2 10.9 10.6 10.2
Group)
Tetley Tata Consumer Products Ltd 7.5 8.0 8.5 9.5
Brooke Bond Red Label Hindustan Unilever Ltd 9.2 9.0 8.7 9.1
(Unilever Group)
Wagh Bakri (Gujarat Wagh Bakri Ltd 6.9 7.4 7.6 7.4
Tea Processors &
Packers Ltd)
Lipton (Unilever Group) Hindustan Unilever Ltd 5.4 5.8 5.8 6.3
Lipton Yellow Label Hindustan Unilever Ltd 2.3 2.2 2.2 2.2
(Unilever Group)
Twinings (Associated Twinings Pvt Ltd 2.2 2.1 2.1 2.0
British Foods Plc)
Society Amar Tea Pvt Ltd 1.6 1.6 1.5 1.4
Goodricke Goodricke Group Ltd 1.5 1.5 1.4 1.4
Gaia Cosmic Nutracos Solutions 1.2 1.2 1.2 1.2
Pvt Ltd
Girnar Girnar Food & Beverages 0.9 0.9 0.8 0.8
Pvt Ltd
Duncans Duncans Industries Ltd 0.4 0.4 0.3 0.3
Tata Tea Tata Global Beverages Ltd - - - -
Tetley Tata Global Beverages Ltd - - - -
Private label Private Label 2.8 2.8 2.7 2.6
Others Others 27.2 27.1 27.9 27.3
Total Total 100.0 100.0 100.0 100.0
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources
Table 7 Forecast Retail Sales of Tea by Category: Volume 2023-2028
Tonnes
2023 2024 2025 2026 2027 2028
Tea 436,050.7 452,736.3 468,136.2 482,273.4 496,184.7 510,006.1
Black Tea 409,839.3 422,189.1 432,435.3 440,400.5 447,232.7 452,877.3
- Loose Black Tea 403,254.8 414,553.3 423,388.2 429,536.1 434,081.2 436,860.6
- Tea Bags Black 6,584.5 7,635.8 9,047.1 10,864.4 13,151.6 16,016.6
Fruit/Herbal Tea - - - - - -
Green Tea 26,211.4 30,547.2 35,700.9 41,872.8 48,951.9 57,128.8
Instant Tea - - - - - -
Other Tea - - - - - -
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources
Table 8 Forecast Retail Sales of Tea by Category: Value 2023-2028
INR million
2023 2024 2025 2026 2027 2028
Tea 238,479.3 252,597.1 269,795.7 290,059.8 312,806.3 338,733.8
Black Tea 170,119.3 173,480.2 177,307.9 181,057.3 184,696.8 188,428.8
- Loose Black Tea 161,431.9 163,382.6 165,314.0 166,615.3 167,178.4 167,049.8
© Euromonitor International
TEA IN INDIA Passport 6
- Tea Bags Black 8,687.4 10,097.6 11,993.9 14,442.0 17,518.4 21,379.0
Fruit/Herbal Tea - - - - - -
Green Tea 68,360.1 79,116.8 92,487.8 109,002.5 128,109.5 150,305.0
Instant Tea - - - - - -
Other Tea - - - - - -
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources
Table 9 Forecast Retail Sales of Tea by Category: % Volume Growth 2023-2028
% volume growth
2023/24 2023-28 CAGR 2023/28 Total
Tea 3.8 3.2 17.0
Black Tea 3.0 2.0 10.5
- Loose Black Tea 2.8 1.6 8.3
- Tea Bags Black 16.0 19.5 143.2
Fruit/Herbal Tea - - -
Green Tea 16.5 16.9 118.0
Instant Tea - - -
Other Tea - - -
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources
Table 10 Forecast Retail Sales of Tea by Category: % Value Growth 2023-2028
% constant value growth
2023/2024 2023-28 CAGR 2023/28 Total
Tea 5.9 7.3 42.0
Black Tea 2.0 2.1 10.8
- Loose Black Tea 1.2 0.7 3.5
- Tea Bags Black 16.2 19.7 146.1
Fruit/Herbal Tea - - -
Green Tea 15.7 17.1 119.9
Instant Tea - - -
Other Tea - - -
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources
© Euromonitor International
