Tata Consumer shares rally over 4% after Q2 results. Why brokerages remain bullish despite target price cuts

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ETMarkets.com

Brokerages remain positive on Tata Consumer Products, even as cost pressures prompt target price cuts.

Tata Consumer Products said its revenue from operations stood at Rs 5,661 crore for the second quarter of FY27, up 14% from Rs 4,966 crore reported in the corresponding quarter of the previous financial year. The firm’s consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) meanwhile increased 18% to Rs 794 crore during the quarter.

“We delivered our second consecutive quarter of double-digit revenue growth in FY27, backed by strong underlying volume growth in India business. This volume-led performance, together with disciplined execution, drove 18% EBITDA growth,” said Sunil D’Souza, managing director and chief executive officer of Tata Consumer Products.

Also read | Tata Consumer Q2 Results: Net profit rises 16% YoY to Rs 470 crore, revenue up 14%

Jefferies on Tata Consumer Products share price

Jefferies maintained its ‘Buy’ rating on Tata Consumer Products shares but reduced its target price to Rs 1,250 apiece from Rs 1,450. The latest target price implies around 33.5% upside potential from the stock’s previous closing price.

The international brokerage noted that Tata Consumer Products remains a key beneficiary of the rapid adoption of quick commerce, especially in the growth portfolio, which contributed around 38% of the India business in the second quarter, with this share set to reach around 50% in three years.

Overall, the FMCG major’s Q2 performance was ahead of estimates despite inflationary pressures in tea and salt segments, but product price hikes should help in future, according to Jefferies. International business saw a revenue decline but saw margin expansion.

Nuvama on Tata Consumer Products share price

Nuvama Institutional Equities maintained its ‘Buy’ rating on the shares of Tata Consumer Products, but reduced its target price to Rs 1,275 apiece, implying over 36% upside potential from the stock’s previous closing price. The brokerage noted that the company’s Q2 earnings print was in line with estimates.

The brokerages reduced the target price to factor in the EPS estimate cuts and inflationary pressures in the economy.

Elara Capital on Tata Consumer Products share price

Elara Capital reiterated its ‘Accumulate’ call on shares of Tata Consumer Products but reduced its target price to Rs 1,080 apiece from Rs 1,290. The latest target price implies more than 15% upside potential.

The brokerage noted that the company’s 14% revenue growth was in line with estimates, according to ET Now. It added that the valuation contribution from Tata Starbucks JV was revised to Rs 40 per share from Rs 54.

Systematix on Tata Consumer Products share price

Systematix Institutional Equities upgraded its rating on the shares of Tata Consumer Products to ‘Buy’ but reduced its target price to Rs 1,185 apiece from Rs 1,245 apiece. It noted that the company delivered the tenth straight quarter of double-digit revenue growth.

Tata Consumer Products is consistently generating strong double-digit topline growth across most segments (excluding India tea) for the past five-six quarters now, led by sturdy volume growth, the domestic brokerage noted. In addition, the portfolio is pivoting towards higher-growth businesses, like Sampann, Soulfull, RTD, which are also now starting to assert themselves on margins, it added.

While this transformation could likely be gradual, it reduces dependence on the seasonal tea business, Systematix said. “We also like the near- to medium-term margin construct with product mix enrichment accruing from premium variants of pulses, dry fruits, breakfast cereals, snacks (poha, makhana), RTD beverages and cold-pressed oils. The recent sharp stock price correction (-19% over the past 6 months) provides downside comfort,” it added.

Also read | Tata consumer Q2 net profit up despite higher costs, weak tea demand

Tata Consumer Products share price

Tata Consumer Products shares have fallen more than 3% in the past one week and around 5% in a month, with the stock being down more than 20% in 2026 so far.

In the longer term, shares of the FMCG major have delivered positive returns of a little over 6% in three years and 15% in five years. The company has a market capitalisation of more than Rs 92,685 crore.