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JM Financial Services
Tata Consumer Products (Buy)
CMP: ₹351.85
Target: ₹385
Tata Consumer Products Ltd (TCPL) held its maiden investor interaction with its new CEO Sunil D’Souza post the Q4 earnings announcement.
Admittedly, Sunil is still ‘new’ to the job, having only worked-from-home thus far after joining TCPL — he came from Whirlpool India and took over after the country was well into the lockdown. The reason he cited for taking up this job is quite interesting — the combination of brand Tata, the Group’s willingness to put its resources and might behind aggressively growing FMCG vertical and the opportunities to premiumise the business is what he found compelling about the TCPL ambition.
A lot of this ambition would, in our view, depend upon how the non-salt, non-tea India portfolio shapes up over the coming years — this part of the portfolio is just about ₹300 crore in size at present, but it is on this portfolio that a lot of hopes are pinned upon, from a transformation perspective.
The narrative is interesting, and the company seems to now have a solid CEO to drive the same (Sunil’s record at Whirlpool India has been a commendable one) — success of the transformation exercise is what would further drive TCPL’s trading multiple ahead.
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