1. At a Glance
This isn’t just another FMCG company. It’s the one serving chai, salt, and sass in the same packet. Tata Consumer’s Q1 FY26 results are piping hot: revenue up 10%, PAT up 15%. But is that enough to justify an 80x P/E? Or are investors just high on Himalayan water fumes?
2. Introduction with Hook
Imagine you walked into a kirana store, picked up a packet of Tata Salt, sipped some Tata Tea, and washed it down with Himalayan water. Now imagine doing the same with Tata’s valuation – except it costs you 80x earnings. That’s right, Maggi at airport prices.
Two spicy stats to munch on:
- Net Profit for Q1 FY26: ₹332 Cr (Consolidated, up 15%)
- 3-year stock CAGR: Just 10%. Basically, a Tata Nano in Ferrari skin.
3. Business Model (WTF Do They Even Do?)
They sell you tea, salt, spices, pulses, coffee, and water — everyday stuff. But they brand it, distribute it like Amazon on caffeine, and slap “Tata” on top like it’s a Michelin star.
- Tata Salt – India’s biggest salt brand
- Tata Tea – #2 in India
- Tetley – Owns UK & Canada tea time
- Eight O’Clock – #4 US coffee brand
- Tata Sampann – Your masala dabba’s best friend
Basically: They turn daal-chawal into Starbucks-level premium FMCG.
4. Financials Overview
Let’s bring out the calculator and the popcorn:
| Metric | FY25 | FY24 | YoY Growth |
|---|---|---|---|
| Revenue | ₹17,618 Cr | ₹15,206 Cr | 15.9% |
| EBITDA | ₹2,479 Cr | ₹2,284 Cr | 8.6% |
| Net Profit | ₹1,287 Cr | ₹1,215 Cr | 5.9% |
| OPM | 14% | 15% | Down 1% |
| ROE | 7% | 7% | Flat like stale chips |
Commentary: Margins tighter than Mumbai parking spots. Operating profits grew slower than your mutual fund returns in 2022.
5. Valuation
Tata Consumer is priced like it sells iPhones, not iodised salt.
- P/E Ratio: 80x
- EV/EBITDA: ~40x (depending on TTM calc)
- Book Value: ₹202; CMP ₹1,063 → 5.26x P/BV
Fair Value Estimate (Brace yourself):
- P/E-based: ₹650–750 (assuming 45–50x normalized)
- EV/EBITDA-based: ₹700–800
- FV Range: ₹675–775
If you think 80x earnings is reasonable, you probably also bought popcorn in PVR.
6. What’s Cooking – News, Triggers, Drama
- Q1 FY26 Results: Revenue up 10%, Net Profit up 15%. Salt still salty, tea still strong.
- Standalone PAT: ₹714 Cr (Standalone looking better than Consolidated – thanks India business)
- Global Tea Biz: Margins still not brewed strong enough
- Shareholding Drama: FIIs reducing stake; DIIs soaking it up like chai on a rainy day
- M&A Buzz: Rumored international expansion brewing again
- IPO Talk: Subsidiary level demerger chatter still hovering like a college breakup
7. Balance Sheet
| Item | FY25 |
|---|---|
| Total Assets | ₹31,831 Cr |
| Total Liabilities | ₹31,831 Cr |
| Reserves | ₹19,902 Cr |
| Borrowings | ₹2,393 Cr |
Key Line: Debt isn’t Titanic-level, but the ship definitely tilts if the Fed sneezes.
8. Cash Flow – Sab Number Game Hai
| Item | FY23 | FY24 | FY25 |
|---|---|---|---|
| CFO | ₹1,461 Cr | ₹1,937 Cr | ₹2,057 Cr |
| CFI | ₹-834 Cr | ₹-1,911 Cr | ₹-2,303 Cr |
| CFF | ₹-714 Cr | ₹256 Cr | ₹453 Cr |
Comment: Cash flow looks like your freelancer friend — always juggling, never chill.
9. Ratios – Sexy or Stressy?
| Ratio | Value |
|---|---|
| ROE | 7.01% |
| ROCE | 9.16% |
| P/E | 80.15 |
| PAT Margin | ~7% |
| D/E | 0.12 |
Key Take: ROCE is not exactly sexy, unless you’re turned on by single digits.
10. P&L Breakdown – Show Me the Money
| FY | Revenue | EBITDA | PAT |
|---|---|---|---|
| FY23 | ₹13,783 Cr | ₹1,856 Cr | ₹1,320 Cr |
| FY24 | ₹15,206 Cr | ₹2,284 Cr | ₹1,215 Cr |
| FY25 | ₹17,618 Cr | ₹2,479 Cr | ₹1,287 Cr |
Observation: PAT grew, but only if you squint and tilt your head to the side.
11. Peer Comparison
| Company | Rev (Cr) | PAT (Cr) | P/E | ROE |
|---|---|---|---|---|
| Tata Consumer | ₹18,045 | ₹1,330 | 80x | 7% |
| CCL Products | ₹3,106 | ₹310 | 37x | 17% |
| Jay Shree Tea | ₹858 | ₹35 | 9.5x | ~10% |
| Goodricke | ₹929 | ₹7 | 66x | 2.8% |
Verdict: Looks like the least drunk guest at a wedding full of finance bros.
12. Miscellaneous – Shareholding, Promoters
| Holder | Mar 2024 | Jun 2025 |
|---|---|---|
| Promoter | 33.84% | 33.84% |
| FII | 21.54% | 21.96% |
| DII | 21.96% | 22.02% |
| Public | 22.66% | 22.15% |
- Promoters holding steady (no dramatic exits)
- FIIs reducing from 25.5% to 21.9% in 1 year
- DIIs happily sipping Tata Tea
Also: Dividend payout? A buttery 64.4%. That’s basically FMCG version of “Paise kamao, paise batao.”
13. EduInvesting Verdict™
Tata Consumer is the BMW of FMCG branding – sleek, trusted, and everywhere. But is it driving too fast for its own financial horsepower?
It’s a great coffee-table stock: looks classy in your portfolio, even if the earnings speed is lukewarm. FMCG plays are defensive, but this one’s priced like it’s launching satellites.
Verdict: A seasoned performer, but currently priced like a celebrity chef’s salt.
Sip it slow, don’t gulp.
Metadata:
Written by EduInvesting Team | 23 July 2025
Tags: Tata Consumer Products Ltd, FMCG, Q1 FY26, EduInvesting Premium, Analysis, Humour, Valuation
