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The Tata Coffee stock continued to bubble on record coffee prices and market expectations over a partnership for a ready-to-drink coffee retail chain.
The stock touched Rs 893, its 52-week high, in Friday's trading and finished hot at Rs 847, up nine per cent.
Asia's largest integrated coffee plantation company, also the country's largest grower and exporter of green coffee and a subsidiary of Tata Global Beverages (formerly Tata Tea) has been raising market storm over past one year. On March 11, 2010 it was at Rs 341.50.
According to commodity experts and market insiders, both soaring beans prices in the international markets and the proposed alliance with Starbuck has been driving the stock off late.
Mr A.K. Bhandari, former UPASI president, told Business Line, the London price of Robusta, (Tata Coffee's biggest money-spinner), on Friday at 11 GMT came off its Wednesday's three-year peak by around $60. “It is a technical retreat, not a fundamental one. Both Arabica and Robusta, however, are ruling near their multi-year highs on supply shortages in the global markets,” he added.
New ventures
Apart from plantation-related businesses — growing of coffee, tea, pepper, cardamom and timber — Tata Coffee has ventured into branded roasted coffee retail through Mr Bean, out-of-home beverages retail through Tata Café Jiffy and Mr Bean Coffee Junction and niche hospitality through its Plantation Trails.
According to Sharekhan, Tata Coffee (consolidated) numbers registered a robust revenue growth of 14.5 per cent Y-o-Y during the gone-by quarter. Sharekhan found “encouraging” the Y-o-Y 10 per cent coffee revenue growth of Eight O'clock, one of the two Tata Coffee's overseas subsidiaries.
Tata Coffee has 19 estates in South India, producing approximately 10,000 tonnes of coffee — Robusta and Arabica — in both washed and unwashed forms.
Tata Coffee is also a leading exporter of instant coffee, made out of robusta beans. Alliance Coffee is its other subsidiary, which markets Tata Coffee's spray-dried, freeze- dried and agglomerated instant coffee overseas.
( >jayanta_mallick@thehindu.co.in )
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