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Tata Consumer has responded to reports that Starbucks is pulling out of India due to high costs and heavy losses. This comes after reports of the coffee shop pushing back plans to open a Starbucks store until later.
According to a Reuters report, Tata Consumer has called reports of Starbucks exiting India, “baseless”.
Meanwhile, shares of Tata Consumer Products Ltd were trading 0.69% higher than Rs 915.60 today. At this quoted price, the stock is down 14.16 percent in the 2024 calendar year to date.
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According to a special report earlier this week in Reuters, fewer customers are walking into restaurants, which has forced Starbucks to revise its plan to open more stores.
Tata Consumer CEO Sunil D’Souza told a news agency last week: “We’re going to have a limited time – maybe instead of opening 100, we’ll open 80 now, and next year we’ll open 120 instead of 100.” However, Starbucks is still targeting its goal of opening 1,000 stores by 2028.
“In India, a good place to have cars … is difficult,” he said, contrasting it with the “great development of markets” in China. Despite the challenges, the CEO of Tata Consumer remains optimistic about the long-term outlook for coffee.
In the last fiscal year, Starbucks reported a 12 percent increase in sales, reaching $143.6 million, but its losses grew. The company’s revenue in the first half of this year only increased slightly.
According to data from business information provider Tofler, Starbucks’ revenue in the last fiscal year more than doubled compared to four years ago.
