TCPL’s Q4FY24 was in line with our estimates. We reckon, stock trigger in FY25-26 is likely outperformance of growth businesses (which are gross margin accretive too). Post-acquisition of Capital Foods and Organic India, salience of growth businesses is ~30% of India branded sales. It needs to execute the basics - derive synergies, distribution expansion, increase in through-put per store etc. Starbucks plans to reach 1,000 outlets FY28 (421 currently). We believe TCPL has all ingredients (resources, bandwidth, innovation pipeline, etc.) to achieve these targets. Maintain BUY.
OutlookWe model TCPL to report revenue and PAT CAGRs of 16% and 18.5%, respectively over FY24-26E led by improvement in profitability of India Foods and revival in profitability of international business. We maintain BUY and value the stock on DCF (unchanged TP of INR 1,360).
For all recommendations report, click hereDisclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Tata Consumer Products - 24042024 - iciDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
