Starbucks, the US-based coffee chain, helped shares of Tata Global Beverages jump over 10 per cent on Tuesday after the two companies signed a deal to open cafes in India.
Investors gave a thumbs up to the joint venture as the scrip climbed 6.17 per cent to touch an early high of Rs 104 on the Bombay Stock Exchange (BSE) before surging further to end the day at Rs 107.75, up 10.01 per cent.
Similar trend was seen at the National Stock Exchange (NSE), where the stock rallied 6.17 per cent to Rs 103.95, before closing at Rs 107.75 - 10.06 per cebnt higher.
Starbucks has entered India through a 50:50 joint venture with Tata Global Beverages (TGB), a business partnership that will facilitate speedy roll-out - an ambition made clear when they announced plans to launch 50 cafes by end 2012.
The alliance is made in heaven, giving Starbucks access to all of the Tata's hotel properties, reducing the headache of a real-estate hunt considerably as far as cafés are concerned.
In addition, Starbucks will be able to ride on the distribution strength of Tata Global Beverages, which markets brands such as Tata Tea, Tetley Tea, Tata Coffee and Himalayan Water.
"This is a positive news for Tata Global Beverages. Starbucks is a successful franchise and the joint venture is a win-win for Tata Global Beverages," Ashika Stock Brokers Research Head Paras Bothra said.
Starbucks already has a deal with Tata Coffee to source coffee for its global operations.
"The company has entered into a joint venture with Starbucks group whereby, the newly formed joint venture company Tata Starbucks Ltd shall engage in the operation of Starbucks Cafes," Tata Global Beverages said in a statement to BSE.
In a separate filling, Tata Coffee said it has also entered into separate agreements with Starbucks Coffee International, Inc, USA (Starbucks) and Tata Starbucks for supplying the beverage to outlets in India and other global markets.