Tata Consumer ProductsThe company, which sells tea, salt, spices and other consumer products, has delivered high returns of up to 90 per cent to its investors in the past two years despite rising inflation and a growth-threatening pandemic. It is stated in the FY22 Annual Report that FMCG company Focuses on six strategic initiatives identified by management to strengthen its foundation as a strong consumer products company.
Domestic brokerage and research firm Motilal Oswal said, “Tata Consumer’s overall strategy is to strengthen and accelerate its core business, exploring new opportunities, opening synergies, digitizing supply chain, expanding its product portfolio and innovating “
The company is increasing its focus on premiumization and health and wellness products, embedding sustainability, and expanding its sales and distribution infrastructure, supply chain, and capacity building towards being a multi-class FMCG player. Is.
“Tata Consumer Products is manufacturing Tata Sampan, their pantry range. It should grow in high double digits by capturing market share from unorganized players through increase in distribution reach and product launches,” it added.
Tata Consumer Products: Share Price History
Tata Consumer Products, part of the Indian conglomerate Tata Group, is a fast growing consumer goods company (FMCG). The Tata group’s stock has fallen more than 2 per cent so far in 2022 (YTD) while it is down nearly 3 per cent in a one-year period. However, the company has almost doubled investors’ money in the last two years and has given around 385 per cent returns in the last 5 years. The stock touched a 52-week low of Rs 650.20/share and 52-week high of Rs 889/share on March 7, 2022.
Tata Consumer Products: What do analysts expect?
The brokerage house expects revenue/EBITDA/PAT CAGR of 11 per cent/19 per cent/29 per cent during FY 2012-24 and arrived at a FY24E SOTP-based target price of Rs 900 per share, which is approx. Indicates a possible bounce. 25% from the current stock level. It has retained its buy rating on Tata Consumer shares.
“The opening up of sales and distribution synergies with the merger of group companies is starting to show results. This is evident from the increase in market share in tea (+100bp YoY) and salt (+400bp YoY) till March 22, supported by growth in numerical distribution. The company is establishing a strong S&D channel, which will act as a key growth driver,” said Motilal Oswal.
In FY 2012, Tata Consumer expanded into new target markets, launched regionally focused packs, unveiled impressive campaigns across multiple platforms and boosted premiumisation.
Jefferies began coverage on the stock earlier this month, saying the rally may not stop there. The broker has set a bull case target of Rs 1,060 and a base case target of Rs 960 for the next 12 months.
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