Tata Consumer Products share price surged 8% in FY25

Tata Consumer Products (TCPL) has made headlines recently as its stock surged by over 8% following a positive upgrade from Goldman Sachs. The stock hit an intraday high of ₹1,073.15 on April 2, 2025, thanks to an upgrade to a ‘Buy’ rating and a price target hike from ₹1,040 to ₹1,200.

This comes with a fresh outlook on the company’s potential earnings growth in the coming years. Let’s break down what this means for investors and why Goldman Sachs is optimistic about Tata Consumer Products.

A history of growth and diversification

Tata Consumer Products has always been one of the big players in the fast-moving consumer goods (FMCG) sector. The company is a household name with a diverse portfolio that includes tea, coffee, salt, pulses, water, and more.

Over the years, Tata Consumer has strategically expanded its footprint and product lines. In fact, the company recently merged three of its wholly-owned subsidiaries, including Tata Consumer Soulfull Pvt Ltd, NourishCo Beverages Ltd, and Tata SmartFoodz Ltd, all contributing to its broader FMCG empire.

But it’s not just about acquiring companies. Tata Consumer Products continues to innovate and focus on expanding distribution in key areas, especially in its growing businesses. In this article, we’ll delve into why the stock price has gained so much traction and what to expect going forward.

Also read: List of FMCG Stocks in India 2025 – StockGro

The big boost: Goldman Sachs’ upgrade

On April 2, 2025, Goldman Sachs gave a major boost to Tata Consumer’s prospects by raising its price target to ₹1,200 per share. The analysts at Goldman Sachs forecast robust earnings per share (EPS) growth over the next few years, specifically FY25- 27. This positive outlook is based on a few key factors:

Tea margin recovery: Goldman Sachs expects a significant improvement in tea margins, particularly due to price hikes implemented by Tata Consumer Products.
Innovation and expansion: The company’s push for innovation in its existing product lines, along with expanding its distribution network, has made it one of the most promising FMCG stocks in the sector.
Debt reduction: With reduced net interest costs as the company pays down its debt, Tata Consumer is in a better financial position to fuel its growth.

Recent financial performance

In the most recent quarterly results, Tata Consumer Products showed strong top-line growth, but the bottom-line performance remained flat. Here’s a snapshot of the key figures from the Q3 FY25 results:

Metric	Q3 FY25 Value	YoY Change
Revenue	₹4,443 crore	+17%
EBITDA	₹564 crore	-1.4%
EBITDA Margin	12.7%	N/A
Net profit	₹279 crore	Flat

While the revenue growth of 17% year-on-year is impressive, the company’s EBITDA saw a slight dip due to increased costs, particularly in tea production.

However, the fact that the company was able to maintain a strong revenue growth despite these challenges speaks to the strength of its core operations and market presence.

Also read: BSE share price leaps 23% on SEBI’s expiry rule proposal

Technically speaking, Tata Consumer Products’ stock has been showing strong bullish signals. It is trading above the 5-day, 10-day, 20-day, 50-day, 100-day, and even the 200-day moving averages. This indicates that, from a technical perspective, investor sentiment is highly positive.

Additionally, although the Relative Strength Index (RSI) of 57.4 is far from being overbought (which would be above 70), the stock is well-positioned for continued growth, especially considering the strong momentum in the broader FMCG sector.

Looking at the performance over the past few years, Tata Consumer Products has done well. Despite some short-term fluctuations, the stock has surged by 41% over the last two years. Although the stock faced a slight dip in the last six months, the overall trajectory remains upward.

Here’s a quick look at some of the key metrics for the stock:

Current share price: ₹1,073.15
52-week high/low: ₹1,246/₹883
Market capitalisation: ₹1,05,600 crore
P/E Ratio: 91.69
EPS (TTM): ₹11.63

Conclusion

Goldman Sachs’ upgrade is a clear indication that the stock is on a positive trajectory, with strong growth potential over the next few years. With a solid outlook on earnings, ongoing innovation, and expanding distribution, Tata Consumer Products is well-positioned to navigate the challenges of the competitive FMCG market.

Investors looking for a stable, long-term play in the FMCG sector may find this stock to be a strong candidate. While short-term fluctuations are inevitable, the long-term outlook looks promising to analysts.

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