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Tata Consumer Products Q4 result was announced on Tuesday and today, its stock has been impacted severely. Tata Consumer Q4 announcement indicated a 22.5 per cent drop in its Q4FY24 net profit at ₹267.7 crore - in the corresponding period last year it was ₹345.6 crore. Tata Consumer revenue from operations in Q4 increased 8.5 per cent to ₹3,927 crore - in the year-ago period, it was at ₹3,619 crore. Tata Consumer board has declared a final dividend of 775 per cent for FY24.
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The impact of the result announcement was seen in the stock markets today. Tata Consumer share price today fell over 5 per cent on the BSE in morning trade. Notably, this happened after three consecutive sessions of gains. Tata Consumer share price opened at ₹1,112.90 against its previous close of ₹1,173.25 and fell 5.30 per cent to ₹1,111.05. At 1:29 pm IST, the share was trading at ₹1,121.05, down −52.30, which is 4.46% in the red.
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Buy, sell or wait?
First things first. Although there was a blip in quarterly numbers, investors should remember that Tata Consumer stock has been outperforming the equity benchmarks in the last one year by a significant margin. Tata Consumer share price has shot up nearly 68 per cent in the last one year. To put things in perspective, know that BSE Sensex has gained nearly 24 per cent.
Brokerage firms are positive on the stock’s performance even after the announcement of the Q4 results. For instance, ICICI Securities said the company’s Q4FY24 was in line with its estimates and kept a “buy” rating on the stock. Its target price is ₹1,360 - an upside of 16 per cent, LiveMint reported.
"We reckon the stock trigger in FY25-26 is likely outperformance of growth businesses (which are gross margin accretive too). Post-acquisition of Capital Foods and Organic India, the salience of growth businesses is nearly 30 per cent of India branded sales," ICICI Securities said.
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"We believe Tata Consumer has all the ingredients (resources, bandwidth, innovation pipeline, etc.) to achieve these targets," ICICI Securities added.
Nuvama Wealth Management too has kept its “buy” call on Tata Consumer stock. The target price is ₹1,400. Reason being that Tata Consumer’s Q4 EBITDA and adjusted PAT were ahead of its estimates. Also, the company’s revenue was in-line with Nuvama’s estimates.
Tata Consumer result at a glance
* Tata Consumer Products reported a 26.69 per cent decline in consolidated net profit to ₹212.26 crore. ( ₹289.56 crore in the same period a year ago).
* Consolidated revenue from operations stood at ₹3,926.94 crore as against ₹3,618.73 crore.
* Incurred exceptional items of ₹215.8 crore.
* India packaged beverages business delivered 2 per cent revenue growth
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* Foods business grew 20 per cent.
* International business revenue grew 7 per cent.
* Tata Starbucks added 29 net new stores - entered 6 new cities.
* For the fiscal ended March 31, 2024, consolidated net profit was at ₹1,215.4 crore ( ₹1,320.14 crore in the previous fiscal).
* Consolidated revenue from operations in FY24 was at ₹15,205.85 crore ( ₹13,783.16 crore in FY23).
