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Ventura Wealth Clients
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Tata Consumer Products Ltd. (TCPL) recently released its Q4 FY24 results, presenting a mixed picture for investors. If you invest in stocks of FMCG organisations, read this blog to know how the Tata vertical performed. Let's delve deeper into the key takeaways:

Tata Consumer Q4 results: revenue growth

  • Positive news for TCPL as revenue from operations witnessed an 8.5% YoY increase to ₹3,926.9 crore compared to ₹3,618.7 crore in the corresponding quarter of the previous year.
  • This indicates continued growth across various segments of the company's business portfolio.

Tata Consumer Q4 results: profit decline

  • A major concern is the 22.5% YoY decline in net profit, which came in at ₹267.7 crore compared to ₹345.6 crore in Q4 FY23.
  • This significant drop in profitability requires further analysis from the company to understand the contributing factors.

Tata Consumer Q4 results: operational strength

  • Despite the profit decline, a bright spot is the 23% growth in EBITDA (Earnings Before Interest, Tax, Depreciation, and Amortization) to ₹629.6 crore compared to ₹511.7 crore in the previous year's corresponding quarter.
  • This indicates the company's efficiency in managing its operating costs.

Tata Consumer Q4 results: segmental performance

  • The India packaged beverages business witnessed a modest 2% revenue growth, while the coffee segment continued its strong performance with a 45% revenue increase.
  • The India foods business maintained its double-digit growth trajectory with a 20% increase in revenue for the quarter.
  • The value-added salt portfolio displayed strong momentum, growing 34% and contributing 9% to the overall salt business, aligning with the company's premiumisation strategy.
  • The Tata Sampann portfolio also saw robust growth of 42% in the quarter.

Tata Starbucks expansion

  • Positive news for the coffee chain as Tata Starbucks added 29 new stores during the quarter, entering six new cities.
  • This year marked the highest annual store addition with a total of 95 new stores, bringing the total count to 421 across 61 cities.

Market reaction to Tata Consumer Q4 results

  • The results were released after market hours. Interestingly, shares of Tata Consumer Products closed slightly up by 0.068% on the BSE, indicating a muted investor response.

Looking ahead

While revenue growth is encouraging, the significant decline in net profit requires further investigation. Investors will likely be looking for a clear explanation from TCPL's management regarding the reasons behind the profit drop and their plans to improve profitability in the future. The continued growth of specific segments like coffee and the expansion of Tata Starbucks offer promising signs, but overall, TCPL's Q4 results present a mixed picture, leaving some questions unanswered.

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