After mixed Q4 earnings, shares of Tata Consumer Products fall 6%; Morgan Stanley continues to maintain an overweight position

Share price of Tata Consumer Products, goal for Tata Consumer Products is: On Wednesday, April 24, Tata Consumer Products stole the show on Dalal Street after the announcement of the FMCG company’s mixed fourth-quarter results the previous day. The largest Nifty50 loss was the Tata group stock, which fell as much as 5.7 points to the day’s low of Rs 1,106 on the NSE. The counter was 4.46 percent down at Rs 1,121 on the NSE at 9:55 AM.

Q4 performance for Tata Consumer Products
Following market hours on Tuesday, Tata Consumer Products revealed that its consolidated net profit for the fourth quarter of 2024, ended on March 31, 2024, had decreased by 26.69% to Rs 212.26 crore. The company attributed this decline to exceptional items pertaining to amalgamation costs, acquisitions, asset write-downs, and fair value loss on financial instruments.

In the same time last year, the business reported a consolidated net profit of Rs 289.56 crore, according to a regulatory filing from Tata Consumer Products Ltd (TCPL).

It further said that the overall income from operations for the quarter under review was Rs 3,926.94 crore, up from Rs 3,618.73 crore.

This came up slightly short of Zee Business Research Desk’s prediction of a ten percent annual revenue increase to Rs 3965 crore during the review period.

The firm said that it spent Rs 215.8 crore on extraordinary expenses during the quarter.

“Exceptional item for the current quarter represent costs relating to scheme of arrangement of Rs 91 crore, costs related to acquisitions of Rs 10 crore, asset write-down of Rs 62 crore and fair value loss on financial instruments of Rs 53 crore,” the report said.

Starbucks Tata
“In line with our store addition plans, we added 29 net new stores during the quarter and entered 6 new cities,” the Tata Starbucks firm said.

Outlook for Management
“We saw development in the Indian tea and salt industries throughout the year. TCPL Managing Director & CEO Sunil D’Souza said, “Our premiumization agenda continues to progress well, with the premium portfolio in both tea and salt showing good growth and contributing to an increasing share of the overall portfolio.”

He said, “Our growth companies, Tata Sampann, Tata Soulfull, Tata SmartFoodz, and RTD (ready to drink), maintained their excellent development trajectory with a 40% increase in sales in FY24. Tata Starbucks, which has locations in 61 places, has steadily advanced its growth goals.

Morgan Stanley continues to see Tata Consumer Products as overweight.
With a target of Rs 1,305, Morgan Stanley has maintained an overweight rating on the counter, indicating a potential upside of more than 11% from the previous close. The following are the main points that the international brokerage emphasized in its note:

Due to the sluggish expansion of India’s beverage industry, organic top-line growth was somewhat below projections.

The company’s EBITDA margin of 16 percent was the greatest in the previous 14 quarters.

Strong margin increase in non-branded EBITDA margin growth is supported by overseas sectors
Growth companies had a good fourth quarter.

In FY24, the share of India branded business increased to 18%.

Tata Consumer Products’ Q4 statistics show that although the tea industry continued to decline, market share in the salt sector increased. This is Anil Singhvi’s recommendation.

With goals of Rs. 1,155, Rs. 1,145, and Rs. 1,1365, Zee Business Managing Editor Anil Singhvi suggested selling Tata Consumer Products futures with a stop loss at Rs. 1,188. He said the following on the outcomes:

Mixed bag of results
Revenue falls short of projections; India business struggles
Dividends for Tata Consumer Products
For the fiscal year that ends on March 31, 2024, Tata Consumer Products has proposed a final dividend of Rs 7.75 per equity share of Rs 1. The dividend will be paid after the 61st Annual General Meeting (AGM) and within 30 days of its declaration, if the AGM approves it, as per the company’s filing.