The stock surpassed its previous high of Rs 646 touched on February 17. The Tata group company engaged in the tea & coffee business will replace state-owned Gail India. Shares of Gail India were trading 2 per cent lower at Rs 144, as compared to a 0.31 per cent rise in the Nifty50 index at 09:24 am.
Tata Consumer, formerly known as Tata Global Beverages, will join FMCG peers such as Hindustan Unilever, Nestle India and Britannia in the widely-tracked Nifty 50 index. The move is expected to result in passive inflows of $89 million (Rs 650 crore) in Tata Consumer. Gail, on the other hand, could see outflows of $57 million (Rs 410 crore).
READ MORE
In the past one month, the stocks of Tata Consumer and Gail have outperformed the market by gaining 11 per cent, against a 2.3 per cent rise in the Nifty50 index.
Brokerage Motilal Oswal Financial Services has a ‘buy’ rating on Tata Consumer (TCP) with a target price of Rs 661 per share. TCP has two strong legs in the India business – Tata Tea and Tata Salt – by which it is targeting lower double-digit growth, driven by cross-selling between Tata Chemicals and TCP’s distribution channels and expansion into new geographies.
Commenting on Gail, MOSL said that with ever-increasing gas demand in the country, transmission pipelines would play a critical role in connecting consumers with both imported and domestically produced gas. "With the stock trading at discount to long-term 1-year forward P/E of 13x, Gail offers an excellent investment opportunity," the brokerage firm said. It has a ‘buy’ rating on the stock with a target price of Rs 165 per share.
 "Tata Consumer")