Tata Consumer Products share price rallied 3% today after the reports of the company planning to acquire part stake in packaged water firm Bisleri for as much as Rs 7,000 crore. The stock hit an intraday high of Rs 794.75 on NSE. On the other hand, Orient Beverages shares jumped 10%, hitting the upper circuit for the day. Orient Beverages is the manufacturing and marketing franchise for Bisleri packaged water in India.
Key figures in a nutshell:
Tata Consumer (FY 2021-22: Stock Exchange filings)– Revenue: Rs 12,425 crore– Net Profit: Rs 936 crore– EPS: Rs 10.15– Market Cap (current): Rs 73,340 crore
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From Reliance to Nestle, everyone wants a sip of Bisleri
Bisleri commands over 30% of the bottled water market in India. Reliance Industries, Danone and Nestle have earlier shown interest in purchasing the company. However, after two years of meeting with the Tata Sons chairman and Tata Consumer Products’ CEO, Bisleri chairman Ramesh Chauhan stated he is in talks to sell a large stake. Tata Consumer Products already has a packaged water brand in its portfolio, Himalayan – a premium bottled water brand, inaccessible to a large number of consumers.
Tata Consumer Products said in a statement, “The Company evaluates various strategic opportunities for growth and expansion of the business of the Company, on an ongoing basis. Pursuant to this, the management of the Company remains in discussions with various parties, including Bisleri International Private Limited.”
Tata Consumer stock talk: Analysts bullish on Bisleri acquisition
“Packaged drinking water is a high margin business; therefore, the acquisition of Bisleri will give further traction to its beverage business, and Tata Consumer will become the biggest player in packaged drinking water as it already has the Himalaya brand under it,” said Santosh Meena, Head of Research, Swastika Investmart.
“Bisleri is a strong name and it will help to build a strong liquid beverage portfolio to play in the domestic market. On technical front, the TCPL stock has given a fresh breakout after a prolonged consolidation of nearly one month within the range of Rs 755 to Rs 790. Momentum oscillators RSI continue its Higher Low formation and stand above the centreline suggests the more upside in the prices. One should keep adding the stock in the portfolio for the long-term perspective with stop loss of below 650,” said Akhilesh Jat, Category Manager – Equity Research, CapitalVia Global Research.
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