6 TATACONSUM share price target reports by brokerages below. See what is analyst's view on TATACONSUM share price forecast, rating, estimates, valuation and prediction behind the target. You may use these research report forecasts for long-term to medium term for your investment or trades in 2020.
The new management is sounding much more focussed and talking about potential of new & unpenetrated category along with the growth prospects of existing once. Further with merger, India business contributes 56% to sales, which has the scope to grow faster compared to UK, US & Canada business. We also see potential in margins expansion as other FMCG peers have far superior margin territory. We remain positive on the stock and maintain BUY recommendation with a revised target price of Rs 440/share.
TGBL’s India business revenue contribution has increased from the previous 47% in FY19 to ~52% in H1FY20 with impressive EBITDA margins of 13.5%. The company has been exiting non-core international markets (exit from loss making China, Russia and Czech Republic subsidiaries and stake divested in its Sri Lankan plantations), which has been a drag on sales growth. We have valued TGBL on an SOTP basis, valuing the India domesticbusiness (including TCL’s consumer business) at 5x FY22E sales, international business (US, UK, Canada) at ~1x FY22E sales and Starbucks JV at 2x FY22E sales. We reiterate our BUY rating on the stock with a revised target price of Rs 450 per share.
We considered the following factors while valuing each business: The India tea business (i.e. TGB standalone) on EV/EBITDA basis at 22x, is at a discount to other FMCG names, given the high market penetration and working capital requirement. The coffee business (i.e. Tata Coffee standalone) at 10x EV/EBITDA, given the commodity nature of the business. The overseas branded coffee business at 10x EV/EBITDA, is at a discount to the India branded tea business due to lower growth potential. The overseas tea business at 10x EV/EBITDA, is at a discount to the India tea business given the low EBITDA margin of ~5-6%. TTCH’s salt and other consumer business (which will be merged with TGB) is at 22x EV/EBITDA. The implied value of TGB’s 50% stake in Starbucks is ~INR29b. We initiate on the stock with Dec’21 target price of INR347/share, upside of 16% and Buy rating.
TGBL’s India business revenue contribution increased from the previous 48% to 50% with impressive EBITDA margins of 13.5% during the quarter. Hence, we value TGBL on an SOTP basis, valuing the India domestic business at 5x FY21E sales, international business (US, UK, Canada) at 0.5x FY21E sales and Starbucks JV at 2x FY21E sales. We reiterate our BUY rating on the stock with a revised target price of Rs 350 per share.
TGBL operational performance is largely in line with estimates with stable top-line growth and margin despite slower FMCG growth. On acquisition front TGBL is on its way to complete all the formalities as per schedule. We expect a decent revenue growth of 7.5% and 8.5% in FY20E & FY21E respectively. As the stock has rallied nearly 30% since current year to date despite unfavorable economic condition and that pressure is likely to persist for few more quarters. We value the stock at a P/E of 27x (which is near a 10% premium to the 4 year average 1 year forward valuation of 26x) on FY21E EPS and recommend “SELL” with a target price of Rs. 263.
TGBL’s India business revenue contribution increased from the previous 45- 47% to 54% with impressive EBITDA margins of 15.3% during the quarter. Hence, we value TGBL on an SOTP basis, valuing India domestic business at 4x FY21E sales, international business (US, UK, Canada) at 0.5x FY21E sales and Starbucks JV at 2x FY21E sales We reiterate our BUY rating on the stock with a revised target price of Rs 300 per share.
Tata Global Consumer Play - A Perfect Shot…. Valuation and Risks: Due to aggressive M&A strategy and a growing demand for existing business, we expect a rational growth for TGBL in FY20E & FY21E. We value the stock at a P/E of 27x (which is near a 10% premium to the 4 year average 1 year forward valuation of 25x) on FY21E EPS and recommend “HOLD” with a target price of Rs. 263.
We believe investment behind new categories would be the key to growth in future. Moreover, contribution of international business would come down from 55% to 45%, as it has been a drag on sales growth. We value consolidated branded business at 3x P/Sales, international business at 1x P/sales & Starbucks JV at 2x P/Sales on FY21E revenues respectively, with a revised target price of Rs 250/ share.
We have valued TGBL on SOTP basis, valuing India domestic business at 3x FY21E sales, International business (US, UK, Canada and Australia) at 0.5x FY21E sales and Starbucks JV at 2x FY21E sales We reiterate our BUY rating on the stock with a revised target price of Rs 240 per share.
SOURCE: Data from D'Market via Quandl. Intraday data delayed 15 minutes.
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