Sharekhan's research report on Tata Consumer Products
Tata Consumer Products Limited (TCPL) registered strong performance in Q4FY2023. Revenue grew by 14% y-o-y to Rs. 3,618.7 crore. OPM stood flat at 14.1%. Adjusted PAT grew by 16% y-o-y to Rs. 294 crore. India packaged beverages sales volume recovered to 3% vs. volume decline of 5% in Q3; India food business volumes grew by 8%. NourishCo registered strong 79% growth to Rs. 181 crore.. Management is confident of posting better performance in FY2024, maintaining double-digit revenue growth, led by distribution expansion, market share gains in the tea business, food business maintaining strong double-digit growth, and acquisitions such as NourishCo and Soulfull scaling up fast.
Outlook
The stock currently trades at 48.8x/40.7x its FY2024E/FY2025E earnings. We maintain Buy with an unchanged PT of Rs. 870. Strong earnings visibility and improving cash flows make it a good pick in the FMCG space.
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