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Tata Global Beverages: Premium is on business restructuring, valuation fair

January 14, 2020 / 03:58 PM IST

Deal for 100 percent stake sale in loss-making Czech arm goes through
NCLT nod for merger of consumer-facing business a major catalyst
- The company has gained market share in the domestic space
- Well placed to take on competition with higher investments
Strong rally since early 2019 factors in major positives

Tata Global Beverages (TGBL) (CMP: Rs 352, market capitalisation: Rs 22,272 crore) has many high points to talk about: It continues to execute restructuring initiatives, along with a commendable operating performance in the recent past. Over the weekend, a couple of news reports underscored that.

Its UK-based subsidiary has sealed an agreement with Dr Muller Pharma s.r.o. for a 100 percent stake sale in its Czech arm - Tata Global Beverages Czech Republic. Additionally, the National Company Law Tribunal (NCLT) has approved the scheme of arrangement between Tata Global Beverages and Tata Chemicals, which paves the way for demerger of the consumer product business from Tata Chemicals and integration of the same with TGBL.

Stake sale in Czech subsidiary