Multibagger Stock: A company of Tata Group has proved to be a multibagger in terms of returns and now there is a possibility of further growth in it. Fast moving consumer goods (FMCG) sector giant Tata Consumer has raised investor money more than 29 times in 27 years and now domestic brokerage firm Motilal Oswal has retained its buy rating.
Tata Consumer is the second largest tea company in the world and it is also a well-known company in terms of coffee. Domestic brokerage firm Motilal Oswal has fixed the target price (Tata Consumer Share Price) for investing in it at Rs 890, which is 12 percent upside from the current price. Today on September 27, it has closed on the BSE at a price of Rs 796.75.
Money increased more than 29 times in 27 years
The shares of Tata Consumer were at a price of Rs 29.40 on July 14, 1995, which has now reached a price of Rs 796.75 i.e. the investors’ money has increased by 29.40 times. Now if we talk about this year 2022, then it has jumped 6.55 percent and in five years it has given 287 percent return to the investors.
Last year on October 18, 2021, the shares of Tata Consumer were at a record high of 52 weeks at Rs 862.50. After that it started declining and on March 7 this year it slipped to a 52-week record low of Rs 650.75. However, after that the buying increased and so far it has jumped about 22 percent to Rs 796.75.
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Why experts are betting on Tata Consumer
The company’s standalone gross margins have been increasing for the past five quarters due to sluggish tea prices. Its average price slipped 11 per cent to Rs 147.6 per kg in the first six months of this year. However, after this, due to floods and adverse weather conditions, its prices started climbing from July.
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Although production is expected to be normal, due to which tea prices are likely to remain stable or fall. In such a situation, its gross margin may improve in the financial year 2023. For all these reasons, market experts have retained its buy rating.
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