Tata Consumer jumps 8% in trade; Goldman Sachs upgrades to 'Buy'; check TP

Goldman Sachs believes the company is poised for strong earnings per share (EPS) growth over FY25-27

Tata Consumer Products shares jumped 8.2 per cent in trade on Wednesday, April 2, 2025, logging an intraday high at ₹1,073.55 per share on NSE. Around 10 AM, Tata Consumer share price was up 5.5 per cent at ₹1,046.85 per share on NSE. In comparison, the NSE Nifty was up 0.33 per cent at 23,242.5. 

 

The market capitalisation of the company stood at ₹1,03,585.19 crore. The 52-week high of the stock was at ₹1,250.1 per share and the 52-week low was at ₹882.9 per share.

 

Global brokerage Goldman Sachs has upgraded Tata Consumer Products stock to 'Buy' from 'Neutral' and has raised the target price to ₹1,200 per share from ₹1,040, as per Bloomberg.

 

The brokerage believes the company is poised for strong earnings per share (EPS) growth over FY25-27, according to reports. 

 

The net interest cost of the company is likely to be lower as acquisition costs are paid down. Further, tea margins are expected to recover with price hikes. While competition remains a concern, Goldman Sachs believes the worst is behind it. 

 

Meanwhile, Nomura also iterated a 'Buy' call on Tata Consumer Products with a target of ₹1,250 per share, as per Bloomberg. However, CLSA maintained a 'Hold' rating and has reduced the target price to ₹992 per share from ₹1,049 per share, 

 

In the third quarter ended December 31, 2024, Tata Consumer Products reported a consolidated net profit of ₹279 crore as compared to ₹278.87 crore a year ago. The company's revenue for the quarter under review stood at ₹4,443.56 crore as compared to ₹3,803.92 crore year-on-year (Y-o-Y).

 

Tata Consumer, known for its 'Tetley' tea and its namesake brand of salt, was hurt by rising costs of domestic tea, the company said, as the commodity contributes nearly 60 per cent to overall revenue.

 

Its Indian business, which sells packaged products including pulses and spices and accounts for 56 per cent of profit, reported a 43 per cent fall in profit during the quarter due to the surge in tea prices. 

 

Thus, the company's margins on consolidated earnings before interest, taxes, depreciation and amortisation (Ebitda) contracted by 210 basis points Y-o-Y in Q3.