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Last Updated : Apr 25, 2019 04:35 PM IST | Source: Moneycontrol.com

Buy Tata Global Beverages; target of Rs 240: ICICI Direct

ICICI Direct is bullish on Tata Global Beverages has recommended buy rating on the stock with a target price of Rs 240 in its research report dated April 25, 201

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ICICI Direct's research report on Tata Global Beverages


Consolidated sales for the quarter increased by 5.2% to Rs 1775.5 crore on the back of 6.3% growth in tea business and 9.9% growth in non-branded business; Coffee business marginally declined by ~2% during the quarter. India business grew by 11% mainly driven by 12% volume growth. Net profit declined by ~50% to Rs 36 crore impacted by higher tax outgo and adverse performance from plantation business due to higher wages. TGBL announced acquisition of branded business of Dhunseri Tea for Rs 101 crore to help boost its presence in other parts of India.


Outlook


We have valued TGBL on SOTP basis, valuing India domestic business at 3x FY21E sales, International business (US, UK, Canada and Australia) at 0.5x FY21E sales and Starbucks JV at 2x FY21E sales .We reiterate our BUY rating on the stock with a revised target price of Rs 240 per share.


For all recommendations report, click here


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First Published on Apr 25, 2019 04:35 pm
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