Buy Tata Consumer Product, target price Rs 1160: IIFL Securities

IIFL Securities maintains a positive outlook on Tata Consumer Product and has issued a buy call with a target price of Rs 1160. The current market price of the stock is Rs 1126, indicating potential upside. The company's robust portfolio of brands, strong distribution network, and focus on innovation are seen as key growth drivers. The recent acquisition of Bisleri International Private Limited is expected to further enhance its position in the non-alcoholic beverages segment. Investors are advised to consider buying Tata Consumer Product for potential gains.

About Tata Consumer Product:

Tata Consumer Products (TCP) is a multinational consumer goods company based in India. Formerly known as Tata Global Beverages, TCP was formed in 2020 through the merger of Tata Tea and Tata Coffee with Tata Chemicals' consumer products business. The company offers a diverse range of products including tea, coffee, water, salt, spices, pulses, and packaged food. TCP has a strong presence in India and international markets, with operations spanning over 30 countries. Its iconic brands include Tata Tea, Tetley, Himalayan, Eight O'Clock Coffee, Tata Salt, and Tata Sampann.

52 Week Price Trend:

Tata Consumer Products (TCPL) is currently trading at Rs 1126, falling within its 52-week range of Rs 685 to Rs 1216.3. Despite a significant surge of over 60% from its 52-week low, TCPL's price remains below its 52-week high, indicating potential for further growth. Analysts remain cautious, anticipating a possible correction in the near term, but the company's strong fundamentals, such as its diversified portfolio and market share in key categories, suggest long-term growth prospects. Investors may consider the current price as an attractive entry point, with the expectation of potential value appreciation in the future.

Stratzy's MOST Analysis:

According to Stratzy's MOST framework, TATACONSUM has received an AA rating, indicating a low level of fundamental risk. This rating is based on the company's strong management, positive outlook, safety, and favorable trend. The AA rating suggests that TATACONSUM is a well-managed company with a positive outlook and a solid financial position. The company is also considered to be relatively safe and stable, with a favorable long-term trend. Overall, the AA rating indicates that TATACONSUM is a low-risk investment with a strong potential for growth.

Company's Fundamentals:

Tata Consumer Products (NSE: TATACONSUM) is currently trading at a Stock Price-to-Earnings (PE) ratio of 87.65, indicating that investors are paying ₹87.65 for every ₹1 of earnings per share. The Price-to-Book (PB) ratio of 6.77 suggests that the company's market value is 6.77 times its book value, indicating potential overvaluation. Despite these valuations, the dividend yield of 0.72% provides some income potential for investors. It is important to note that these metrics should be considered in conjunction with other financial indicators and market context for a comprehensive assessment of Tata Consumer Products' investment potential.

Fundamental and Technical information provided in this blog were last updated on 05 Jun, 2024

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