Kolkata-based tea major Madhu Jayanti International (MJIL), having sensed the growing popularity of tea bags among tea drinkers in India, has set its eyes on the segment, with robust expansion and development plans.
The company, which has a diversified tea business spanning over 40 countries and involvement in contract manufacturing and own labels, has rolled out its latest tea bag offering called ‘TE-A-ME’, which has 17 types of teas under its umbrella, across five ranges.
“We launched TE-A-ME, a premium brand for the mass segment, which is right now sold in Bengaluru, Chennai, Hyderabad, Pune, Goa, Mumbai and Kolkata. We will be introducing it in Delhi by the year-end, following which we will take it to tier-II cities as well,” MJIL Executive Director Sumit Shah told Deccan Herald. TE-A-ME is the company’s first in-house brand in the tea bag space. TE-A-ME tea bags contain different types of tea such as black tea, aromatic spices, natural green, fruits and flowers, and also, a wellness range. Over the next eight months, MJIL will be adding eight more teas to its TE-A-ME portfolio, taking the total to 25, which Shah claimed as the widest selection in the market.
According to Onicra Credit Rating Agency, the market size of tea in India is estimated to be around Rs 10,000 crore. The tea bag market in India, currently pegged at Rs 800 crore, is projected to grow to Rs 1,500 crore in the next 5-7 years. The company is eyeing a 15 per cent market share over the next three years by riding the 35 per cent growth in the tea bags segment.
MJIL claims to be the largest tea bag manufacturer in India (including contractually manufactured bags), producing over 60 lakh teabags annually. With a turnover of Rs 500 crore, and a five-year CAGR of 25 per cent, Madhu Jayanti operates its business under two models — company-owned brands (contributing Rs 200 crore), and private labelling (contributing Rs 300 crore). Around 70-80 per cent of its business is driven by tea bags.
“We have invested around Rs 15 crore until now, and plan to invest another Rs 15 crore towards our future plans, over the next 18 months, from internal accruals,” Shah said.