KARACHI, Oct 23: Indian tea giant Tata is exploring entry in Pakistan market through Tetley Tea, a UK-based tea company acquired by Tata Limited India about two years ago.

A report of Invest Capital and Securities, a local brokerage house, released on Wednesday quotes a news report of Dow Jones according to which the Tetley’s discussions for a joint venture investment with a big business group in Pakistan is in final stages.

Dow Jones quote senior officials of Tata Group who disclosed that the investment would be through a joint venture with a Pakistani local consumer giant Colgate Palmolive Pakistan, a strong arm of Lakson Group.

Senior executives in local Colgate however maintain a discreet silence on this report. ‘No comment’ quipped a senior executive who was contacted on telephone by Dawn on Wednesday. He neither confirmed nor denied the reports. All insistence and stress failed to pressurise this executive to say ‘correct’ or ‘incorrect’ the news reports about the joint venture with Tatas.

But the Invest Capital and Securities confidently quote market reports which suggest that the joint venture has already established its tea blending plant in Hub and it “may be able to commence operations as early as January 2003.”

“Tetley’s collaboration with Colgate-Palmolive is bound to pose problems to Unilever Pakistan due to Lakson Group’s strong and well entrenched distribution network,” the report observes while pointing out that Colgate is already giving a hard time to Unilever in Pakistan in other consumer goods segments namely detergents and personal grooming products.

According to the report, Tetley is entering into three separate joint ventures in three leading tea markets — Russia, Pakistan and Bangladesh.

The new company is expected to take away two to three per cent of the Pakistani market in its first year of operation, Invest Cap report said. The beverage segments account for the largest portion (40 per cent) of Unilever’s sales and a new entrant is bound to cause problems in terms of sales volume, price competition and marketing expenditure.

Pakistan imports around 130,000-140,000 tons of tea per annum in which the share of smuggling stands at 25,000 tons while the rest find way through genuine imports.