Edelweiss Securities expects Tata Consumer’s structural simplification to yield 5-10% increase in profits

Tata Consumer’s structural simplification to yield a 5-10 percent increase in profits, said Abneesh Roy, executive director-institutional equities at Edelweiss Securities, on Wednesday, adding that simplification in structure will lead to strong management focus.

Tata Consumer Products announced a simplification of its corporate structure. The plan includes a demerger of Tata Coffee's plantation business into a new subsidiary to be called Tata Consumer Beverages and Foods. Further, Tata Consumer will merge the remainder of Tata Coffee's business with itself.

“At the end of this exercise and once they implement all this, they will be down to half; only 22-23 entities and that will lead to much more management time and focus on the core,” Roy told CNBC-TV18.