Tata Consumer has responded to reports that Starbucks is exiting India due to high costs and mounting losses. It comes after the coffee chain announced that it is delaying plans to open some new Starbucks stores to its existing schedule.

According to a Reuters report, Tata Consumer has termed the reports out of Starbucks India as "baseless".

Meanwhile, shares of Tata Consumer Products Ltd were trading 0.69 percent higher at Rs 915.60 today. At this quoted price, the stock is down 14.16 percent so far in the 2024 calendar year.

PRESSURE POINTS AT STARBUCKS

According to a separate Reuters report earlier this week, fewer customers are coming into coffee shops, forcing Starbucks to recalibrate its plan to open more stores.

Tata Consumer CEO Sunil D'Souza told the news agency last week: "We will calibrate for the short term - maybe instead of opening 100, we will open 80 now, and next year we will open 120 instead of 100." However, Starbucks remains focused on its goal of opening 1,000 stores by 2028.

"In India, good quality real estate with traffic ... is a challenge," he said, contrasting it with China's "massive retail development." Despite the challenges, the CEO of Tata Consumer remains optimistic about the long-term prospects of investment in coffee.

Last fiscal year, Starbucks reported a 12 percent increase in sales to $143.6 million, but its net loss widened. In the first half of this year, the company's income has only had a small increase.

According to data from business information provider Tofler, Starbucks' revenue in the latest fiscal year more than doubled compared to four years ago.