Sharekhan has given Buy recommendation for Tata Consumer Products with a target price of Rs. 960 in its research report issued on Aug 11, 2022
Sharekhan’s research report on Tata Consumer Products
Q1FY2023 performance beat our expectations, with a price-led revenue growth of ~11%; OPM expanded 47 bps y-o-y to 13.7%, adjusted PAT grew by 45% y-o-y to Rs. 294.5 crore. Rapid growth in foods business, market share gains in core tea business, widening of distribution network and strong traction in new products will help company to achieve double-digit revenue growth going ahead. Stable raw tea prices, price hikes in domestic salt and international tea businesses and a better mix would help OPM improve consistently in the coming quarters.
Stock trades at 56.0x and 45.9x its FY2023E and FY2024E earnings, respectively. We maintain a Buy with an unchanged PT of Rs. 960.