Calcutta, Feb. 26: Goodricke Group is looking to buy tea gardens in Africa as the cost of production in the continent is much lower than India.

"Besides Assam, our group is looking at acquiring some gardens in Africa," said Arun Narain Singh, managing director and CEO of Goodricke Group.

Tea estates in the country are facing a drought-like situation even as Assam received a little rain a few days ago. "Assam is drawing the bandwagon while the rest of the country is still suffering, including a dry Darjeeling. In 2016, average prices were down to Rs 145 from Rs 175 a year ago for crushed-tear-curl (CTC) and the cost of production was up Rs 10," said Singh.

According to industry estimates, in India, the average cost of production is around Rs 150 a kg, while in Kenya it is less than Rs 100.

Profit watch

While tea producers across the country are making losses, Goodricke is eyeing a profit for the fiscal ending March 2017.

"Goodricke operates mostly in the quality tea segment and that has been hit hard but this is applicable for every organised player. However, we've been able to sustain ourselves as we are present in various categories such as instant and packet tea as well as tea kiosks and lounges. In fact, we will be making profits this year as well," Singh told The Telegraph.

Tea lounge

The tea planter is planning to come up with a tea lounge in Calcutta.

"We have four tea lounges in the country - two in Bhopal and one each in Indore and Kurseong. Branding is a crucial part to sustain the tea business and lounges are a great way to promote them," Singh said.

The company is scouting for a suitable space in the city. Each lounge entails an investment of around Rs 40-45 lakh.

New facility

Goodricke is also coming up with a new blending and packaging unit in Punjab covering an area of 27,432 square feet.

"An initial investment of Rs 2 crore has been made in the plant and will be inaugurated on March 1. It will have a production capacity of 2-3 million kg per annum and will be catering solely to the CTC market with 20 stock keeping units," said Singh.

Goodricke has two more blending and packaging units - one in Indore, which also serves the CTC market and another in Calcutta which is into packaged Darjeeling tea.

"One-third of the company's total revenue come from packet tea," Singh said.