Shares of Tata Consumer Products Ltd (TCPL) could see investor interest after Morgan Stanley reiterated its overweight call on the stock and set a target price of ₹1,255, citing strong earnings momentum and potential for further margin improvement.
In its latest note, Morgan Stanley said that TCPL’s revenue and EBITDA margins for Q1FY26 came in above estimates, buoyed by operational strength and improving cost structures. The brokerage expects EBITDA margins to improve sequentially and return to normative levels, supported by gains in gross margins.
A key highlight in the report was Tata Consumer’s tea business, where gross margins are projected to rise to 34–37% from the current 24%, reflecting better pricing, scale benefits, and lower input costs. This would significantly bolster overall profitability for the company, which also operates in packaged foods, beverages, and staples through marquee brands such as Tata Tea, Tetley, Tata Salt, and Tata Sampann.
Morgan Stanley’s positive outlook follows Tata Consumer’s strategic investments in brand building, distribution expansion, and premiumisation across product categories. Analysts believe that the company is well-positioned to capture the next phase of growth in India’s fast-moving consumer goods (FMCG) sector.
