Tata Consumer shares jump 8% on rating upgrade by Goldman Sachs; here’s what brokerage says

Shares of Tata Consumer Products rallied over 8% in early trade on Wednesday after foreign brokerage Goldman Sachs upgraded the Tata Group stock to a 'Buy' rating. The brokerage house has also raised target price of the FMCG stock to ₹1,200 from ₹1,040 earlier, citing improvement in earnings, recovery in tea margins, and distribution expansion.

Boosted by the development, Tata Consumer Products shares opened 1.8% higher at ₹1,010.05, after ending nearly 1% lower at ₹991.90 in the previous session. In the first hour of trade so far, the largecap stock gained as much as 8.2% to ₹1,073.55 amid strong volume as 1.16 lakh shares changed hands over the counter compared to two-week average of 0.48 lakh scrips.

At the time of reporting, shares of Tata Consumer Products were up 5.4% at ₹1,045.90, with a market capitalisation of ₹1.04 lakh crore. The counter touched its 52-week high of ₹1,247.75 on July 24, 2024, and a 52-week low of ₹884 on December 20, 2024. The Tata group stock has given negative return of 6% in the last one year, while it has fallen 8% in six months. In the calendar year 2025, the counter has risen over 15%, whereas it added over 11% in a month.

Goldman Sachs assigns 'Buy' rating to Tata Consumer Products

The foreign brokerage has upgraded Tata Consumer Products shares, citing strong earnings per share (EPS) growth over FY25-27. It expects recovery in tea margin through price hikes to boost profitability of the company.

While competitive intensity remains a concern for the company, but its strong innovation and distribution expansion in its growth businesses augur well for the firm, the report highlighted. The net interest cost has also dropped as acquisition debt is paid down, it said in a note.

Tata Consumer receives tax demand of ₹262 cr

The rally in Tata Consumer was seen even after the company informed exchanges that it has received income tax notice of ₹262.08 crore for the financial year 2021-22. The company, however, claimed that there would be no immediate impact on the financials, operations or other activities of the company on account of the tax order.

“The company has received an assessment order dated march 31, 2025, under section 143(3)  of Income-tax Act, 1961, for the income tax return filed for the financial year 2021-22, wherein certain additions/disallowances with respect to returned income, have been proposed by the Assessing Officer,” it said in a BSE filing last evening.

The company further said the tax demand is not “maintainable and it is in the process of preferring an appeal against the said order.”

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