Tata Consumer bullish analysts expect share price to rise up to 42% after Q2 results

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Tata Consumer bullish analysts expect share price to rise up to 42% after Q2 results
- Published OnOct 27, 2026 | 07:47 IST
- Last Updated OnOct 27, 2026 | 07:47 IST
Management reiterated its target of expanding consolidated EBITDA margins by 50-70 basis points annually in FY27. It also expects margins to improve year on year in the second half of the financial year.
Shares of Tata Consumer Products Ltd. will be in focus on Tuesday, October 27, after the company reported its second-quarter results for FY27, with revenue and profit growth supported by strong performance in its growth businesses.
The company reported a 14% year-on-year increase in revenue to ₹5,661 crore for the quarter ended September 2026. Consolidated EBITDA rose 18% to ₹794 crore, while net profit increased 16% to ₹470 crore.
The results were broadly in line with analyst estimates. Revenue came in above the poll estimate of ₹5,605 crore, while net profit exceeded the estimate of ₹456 crore. The company's reported EBITDA was also above the poll estimate of ₹775 crore.
Tata Consumer Products Q2 FY27: Key biz updates
The India branded business recorded underlying volume growth of 11%, while the company’s growth businesses expanded 40% and accounted for 38% of the India business.
Tata Sampann reported 57% revenue growth, while the ready-to-drink (RTD) business grew 47%, supported by distribution expansion and a strong summer. Salt revenue increased 15%, with volumes rising 9%. India tea volumes remained flat, while revenue declined marginally.
Tata Starbucks reported 15% revenue growth, marking a multi-quarter high, supported by strong same-store sales growth. International business revenue rose 7%, although it declined 2% on a constant-currency basis.
Capital Foods and Organic India recorded combined revenue growth of 15%, with domestic revenue increasing 24%. Their export business was affected by shipping disruptions.
Management commentary
Management reiterated its target of expanding consolidated EBITDA margins by 50-70 basis points annually in FY27. It also expects margins to improve year on year in the second half of the financial year.
The company maintained its guidance for growth businesses to expand by around 30%, while targeting mid- to high-single-digit growth in its tea and salt businesses.
Management expects pricing actions across categories, including tea, salt and Capital Foods, along with improving scale efficiencies in growth businesses, to support margins in the coming quarters.
How brokerages reacted to Tata Cons Q2 results
CLSA maintained its 'Outperform' rating on Tata Consumer Products, with a price target of ₹1,372.
The brokerage said that revenue growth of 14% exceeded its estimate by around 3%, while EBITDA growth was broadly in line with expectations. India underlying volume growth stood at 11%, salt volumes rose 9% and tea volumes remained flat.
Growth businesses recorded 40% revenue growth, led by Tata Sampann, which grew 57% year on year. CLSA expects tea business growth to improve and sees scope for better margins in the second half, supported by pricing actions and operating efficiencies.
HSBC maintained its 'Buy' rating, saying the results were a marginal beat, driven primarily by the non-India business. It said that India business margins were flat sequentially.
Growth businesses expanded 40% year on year, compared with 47% growth in the previous quarter. HSBC highlighted the trajectory of India business margins as a key near-term trigger and expects margin improvement, although its FY27 estimate of 40 basis points is below the company's stated 50–70 basis-point target.
Goldman Sachs retained its 'Buy' recommendation, describing the quarter as strong despite a challenging operating environment.
The brokerage highlighted double-digit volume growth in the India branded business and 17% revenue growth. Growth businesses expanded 40%, led by Tata Sampann and RTD.
Capital Foods and Organic India reported domestic growth of 24%, while exports were affected by shipping delays. Goldman Sachs also noted that salt continued to perform well, whereas tea remained subdued. The brokerage said management had reiterated its guidance for 50-70 basis points of consolidated EBITDA margin expansion in FY27.
Morgan Stanley maintained its 'Overweight' rating, citing that revenue and EBITDA grew 14% and 17%, respectively, year on year.
The brokerage highlighted stronger momentum in the India branded business, where revenue growth accelerated to 17%, alongside underlying volume growth of 11%. EBITDA margin stood at 13.8% in its estimates, up 31 basis points year on year and 30 basis points sequentially.
Morgan Stanley said management expects year-on-year margin expansion in the second half, while noting that it had not explicitly reaffirmed the full-year 50-70 basis-point target during the commentary referenced in its report. It added that concerns over margins were already reflected in the stock's valuation.
Citi maintained its 'Buy' rating but reduced its price target to ₹1,225. It highlighted consolidated revenue and EBITDA growth of 14% and 17%, respectively, alongside healthy underlying volume growth in India.
The brokerage pointed to strong performance in salt and growth businesses, led by Tata Sampann and RTD. Although the India tea business remained soft and domestic margins faced input-cost pressures, Citi sees a clearer path to margin recovery in the second half as pricing actions flow through.
Stronger profitability in the international and non-branded businesses is also expected to support consolidated performance.
Jefferies maintained its 'Buy' rating while lowering its price target to ₹1,250. The brokerage said the quarter was better than expected despite inflationary pressures in tea and salt.
It highlighted 40% year-on-year growth in the company's growth portfolio, which accounted for around 38% of the India business in the second quarter. Jefferies expects this share to rise to around 50% over the next three years.
The brokerage believes price increases should support performance in the coming quarters and noted that international business margins improved despite weaker revenue trends. It also said the company's FY27 guidance for 50-70 basis points of year-on-year EBITDA margin expansion remains unchanged.
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