Tata Global Beverages rose over 2 percent to hit a fresh 52-week high on the BSE on Wednesday on media reports which said that the company decided to sell its stake in various Tata group listed companies to its parent, Tata Sons, in the next few months.
The restricting is a welcome step if it happens as restructuring could be a big trigger for Tata Global Beverages, Porinju Veliyath, founder, and CEO of Equity Intelligence India said in an interview with CNBC-TV18.
“I am very bullish on the branded consumer business of Tata Group and hold Tata Global Beverages and Tata Coffee for a long time in my personal portfolio,” he said.
Tata Global Beverages owns close to Rs 755 crore worth of stake in other Tata group firms, especially in Tata Chemicals, said the media report.
“The news is not new as the management has talked about it in the past. Both Tata Global and Tata Coffee have a long way to go and if you believe in the business model, restructuring could well be a very good trigger,” said Porinju.
These are very old bluechip companies but are still trading at 1x sales largely because of Tata’s. If these companies were handled by dynamic and good management they would be trading at 3x sales, he added.
For entire interview, watch accompanying video.
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