Multibagger Tata Group stock hits 52-week high, likely to cross Rs 1,000 mark; key details

Shares of multibagger Tata Consumer Products Ltd (TCPL) are expected to scale the four-digit mark in a year. The FMCG arm of the Tata Group can breach the Rs 1,000 mark on strengthening of the core business and  expansion in addressable market  to clock  steady double-digit earnings  growth in  the medium  to long  run  (revenues/PAT grew  at  CAGR of 13%/20% over FY20-23), said brokerage Sharekhan.

It has assigned a buy call to the Tata Consumer stock with a target price of Rs 1010 against a market price of Rs 856, amounting to an upside of 18%.

“With a strong focus on achieving consistent earnings growth, simplifying business model, and enhancing shareholder value, TCPL remains one of our top picks in the FMCG space. We maintain a Buy on the stock with a revised PT of Rs 1,010. It trades at 53.7x/45.1x its FY2024E/FY2025E EPS,” said Sharekhan.

Tata Consumer Products shares have delivered multibagger returns of 127%, 233% and 530% in the last three, five and ten years, respectively. In the current session, Tata Consumer shares hit a 52-week high of Rs 877 on BSE. Tata Consumer Products stock has gained 20.72% in a year and risen 3.68 per cent in 2023.

Total 0.29 lakh shares of the firm changed hands amounting to a turnover of Rs 2.47 crore on BSE today. The market cap of the firm rose to Rs 79,881 crore on BSE.

The stock hit a 52-week low of Rs 685 on March 16, 2023.

In terms of technicals, the relative strength index (RSI) of Tata Consumer Products stands at 72.7, signaling it's trading in the overbought territory. Tata Consumer Products stock has a one-year beta of 0.8, indicating low volatility during the period.

The firm logged a 23.5% rise in net profit to Rs 268.6 crore for the quarter ended March 2023 as against net profit of Rs 217.54 crore during the quarter ended March 2022. Sales zoomed 14% to Rs 3619 crore in the quarter ended March 2023 as against Rs 3175 crore during the quarter ended March 2022.

The board recommended a final dividend of Rs 8.45 per equity for the financial year. The dividend, if approved by the members at the ensuing annual general meeting, will be paid after the AGM and within 30 days of its declaration, Tata Consumer Products said in a BSE filing.

ICICI Securities in a report on June 13 maintained buy call on the stock and raised target price to Rs 950 against Rs 900 earlier.

“We model TCPL to report revenue and PAT CAGR of 12% and 21%, respectively over FY23-25E. Retain BUY. We value the stock on SoTP basis with a revised target price of Rs 950 (was Rs 900 earlier). Key risk is execution –slower-than-expected ramp up of distribution and steep competition,” the brokerage said.

Also read: Reliance Industries shares at Rs 3,450? Jefferies' upside scenario for RIL assumes possible Jio listing, tariff hikes