Brokerages are divided in their stance on Tata Consumer Products, with two maintaining a buy rating and two assigning a hold amid concerns on valuations and margin pressures. Here’s a summary of the calls:
Nomura on Tata Consumer Products share price – Target Price: Rs 1,300
Nomura maintains a buy rating. The core business grew in double digits due to price hikes and is expected to sustain through FY26F. The growth business (30% of India revenue) grew 24% organically and 66% with acquisitions. Operating profit margin is on an improvement path. The brokerage forecasts 13%/18% EBITDA/EPS CAGR over FY25–28F. The stock trades at 55x FY27F EPS.
Citi on Tata Consumer Products share price – Target Price: Rs 1,325
Citi retains a buy rating, calling Q4 performance in-line and expecting margin recovery in 2HFY26. Growth businesses contribute 28% of revenue and grew 18% YoY in FY25. E-commerce revenue surged 66%, now forming 14–15% of India branded business. Starbucks added 6 stores in the quarter, reaching 479 stores in 80 cities. Citi believes the growth trajectory remains strong across core and new categories.
Jefferies on Tata Consumer Products share price – Target Price: Rs 1,100
Jefferies has downgraded the stock to hold, citing valuation concerns with the stock trading at 70x FY26E P/E after a 24% year-to-date rally. High inflation in tea continues to weigh on margins, slightly impacting EBITDA. Revenue growth was strong, with India volume growth at approximately 6%.
CLSA on Tata Consumer Products share price – Target Price: Rs 1,044
CLSA maintains a hold rating. Q4 net sales grew 17% YoY (12% organic), broadly in line with expectations. Gross profit matched estimates, though gross margin was slightly lower due to high input costs. EBITDA was below estimates owing to higher-than-expected other expenses. CLSA cut FY26–27 EBITDA estimates by 0–1% and raised PAT by 4% on lower finance expenses.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always consult with a qualified financial advisor before making investment decisions.
