Amalgamated Plantation Pvt. Ltd. (APPL), an associate firm of Tata Global Beverages, is planning to expand the reach of its brands throughout northeast as part of a multi-pronged strategy aimed at containing its losses.
It has identified several loss mitigation measures, said Ranjit Barthaku, chairman, APPL in an exclusive chat with The Hindu. Bringing qualitative and quantitative improvements to its crop, encouraging small tea growers, increasing revenue from non-tea crops like pepper and enhancing retail efforts are some of the important measures being planned by the firm.
APPL produces 26.3 million kg of CTC (crush-tear-curl) and orthodox teas from its 25 tea estates in Assam and West Bengal. Another 15 million kg is sourced from small tea growers. Breaking from an earlier profit stint, APPL had been in the red since 2014-15. Its operational revenue was ₹622.5 crore in 2016-17 against ₹569.9 crore a year ago even as losses almost doubled to ₹15.2 crore.
“We are planning to adopt the franchise-model for expanding our retail presence in the northeast,” Jagjeet Kandal, managing director, APPL, told The Hindu. The firm sells more than 50 % of its output through auctions at Guwahati, Siliguri and Kolkata. It has already unveiled its brands, which are sold from its outlets at its tea estates and in Guwahati.
APPL had started taking steps like improving its farm practices, encouraging small tea growers and cultivating crops like pepper to augment revenue. Non-tea business now contributes about 5% of APPL’s revenue. “We want to grow this,” he said.
Quality issues
On quality upgrade plans, it was learnt that a 1990s industry-wage pact, linking earnings with quantity of leaves, had resulted in indiscriminate plucking, disregarding quality. “We have held workshops with internal and external trainers for sensitising the workers..shifting the focus on improving tea quality through better plucking while optimising crop. This helps containing production costs while improving realisations,” Mr. Kandal said.
APPL had also invested ₹15 crore over the last five years to create irrigation facilities in drought-prone areas in Assam.