Tata Consumer Products Limited to Acquire Bisleri | Unlocking Deal Synergies of TCPL-Bisleri Deal

3 min read

As per the report of Economic Times, Tata Consumer Products Limited will acquire Bisleri, the leading packaged drinking water brand in India. What are the deal details, how is the packaged water drinking industry, why Bisleri Promoters are selling their business, and how it is beneficial for TCPL? Let’s discuss all these factors in this article as we move ahead.

Tata-Bisleri Deal:

  • Tata Consumer Products Limited (TCPL) will acquire Bisleri International Limited for around Rs. 6,000- Rs. 7,000 Cr.
  • The current Management Team will continue for around 2 years.
  • Ramesh Chauhan said that it will only sell the part stake and not the whole stake.

Beverage Industry:

  • The total packaged water market is estimated to be worth ₹20,000 crore – with a 60% share for unorganized. Since a large portion of the industry is unorganized, there is a huge scope for growth for the company.
  • Bisleri is the market leader with around 32% market share which is being followed by Coco Cola’s Kinley and Pepsico’s Aquafina.

Why Ramesh Chauhan selling Bisleri:

  • No Succession Plan (His only daughter Jayanti Chauhan is not interested in carrying on the business)
  • In the lack of a successor, Ramesh Chauhan feels that only Tata Group can carry on its legacy and nurture the brand.

Bisleri status:

  • Bisleri International Pvt. Limited is under the ownership of Ramesh Chauhan since 1969.
  • Its Key brands include Bisleri, Vedica, Fonzo, Spyci, and Limonata
  • The company is having 122 Operational Plants, 4,500 distributors, and a fleet of 5,000 Trucks across India & Foreign.
  • Bisleri earned revenue of around Rs. 2,500 Cr. in FY22 with a net profit of around Rs. 220 Cr.

Benefits to TCPL:

  • TCPL, with a presence in the packaged water business, is best suited to leverage the Bisleri brand in its portfolio. Besides, a huge component of packaged water business is unorganized – providing scope for a large FMCG player to expand.
  • The Bisleri brand holds immense promise of growth and unlocking of synergies for TCPL, being part of the Tata group that has a presence in a host of different businesses such as aviation, retail, and e-commerce.
  • This acquisition is in line with the company’s objective to become a leading FMCG player with growing its Food & Beverage portfolio.
  • TCPL already has the following beverage product portfolio: Packaged Water-Tata Himalayan Water,  Tata Copper+ Water. Other beverages- Tata Fruski and Tata Gluco+.
  • The addition of Bisleri to its portfolio may catapult TCPL to unquestioned leadership in the organized packaged water market ahead of Coca-Cola’s Kinley and PepsiCo’s Aquafina

What Should Investors Do:

The Tata Bisleri deal is a strategic partnership between two of India’s leading companies- Tata Group and Bisleri International Private Limited. The partnership aims to unlock synergies between the two by leveraging the strengths of both parties. Tata Group brings its expertise in marketing, distribution, and logistics, while Bisleri provides its expertise in manufacturing, packaging, and product innovation. The deal is expected to close down soon and it will be very beneficial for TCPL to achieve its aspirational target of becoming a leading FMCG player. One should closely watch this counter and should keep this on the radar. Do follow due diligence before making investment decisions.

Disclaimer: The information here is provided for reference purposes only and should not be misconstrued as investment advice. Under no circumstances does this information represent are commendation to buy or sell stocks or MF.

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