Tata Coffee Ltd [Get Quote] has chalked out plans to enter into the beverage retailing business and a pilot project on this is being carried out in southern India.

Tata Tea [Get Quote] managing director Percy Siganporia said Tata Coffee is currently experimenting with a retail format in some parts of south India.

"The project is in the planning stage. More details will be announced later," he said.

The new initiative comes two years after Tata Coffee divested its stake in the Barista espresso coffee chain.

Tata Coffee is a 51 per cent subsidiary of Tata Tea. Tata Coffee is the largest plantation company in Asia, with estates in Coorg, Hassan and Chickmagalur in Karnataka.

The company also grows pepper and cardamom on its estates. Its timber resources include rosewood, silver oak and other varieties of trees.

In 2001, Tata Coffee acquired a contiguous coffee estate in Coorg district of 534 Hectares namely "Coovercoolly estate". With this, the current area under coffee is around 8000 hectares producing over 9000 metric tonnes of coffee annually. Both the Robusta and Arabica varieties of Coffee are grown in the estates.

Tata Coffee has also firmed up a number of initiatives to enable it to steadily move up the coffee value chain thereby improving its margins. The company is currently the exclusive supplier of coffee blends to Barista for its entire range of offerings. Officials said this alliance gives Tata Coffee access to the value added market through Barista's expanding consumer base while Barista would get an access to Tata Coffee's technical and blend experience on speciality coffee.

Tata Coffee has initiated setting up of a joint venture company with its Russian partners for marketing its instant coffee in Russia.

Tata Coffee is also the first plantation company selected by STAR BUCKS as suppliers in India.