Life Insurance Corporation of India (LIC) has raised its stake in Tata Consumer Products (formerly Tata Global Beverages), a consumer products company under the renowned Tata Group, by about 2% through an open market acquisition. The insurance behemoth disclosed in a regulatory filing on July 12 that it purchased 1.86 crore shares, equivalent to 2% of paid-up capital, at an average price of ₹770.69.
As a result of this transaction, LIC's overall stake in Tata Consumer Products has risen to 7.065%, up from the previous 5.060%. The insurer bought these shares between May 12, 2023, and July 11, 2023.
Tata Consumer Products is one of the leading companies of the Tata Group, with a presence in the food and beverages business in India and internationally. It is the second-largest tea company globally.
The company's shares reached a two-year high of ₹877 apiece on June 21, 2023. So far in the current year, the shares have delivered a decent return of nearly 11%. In its recent note, brokerage firm Sharekhan maintained its 'buy' recommendation on the stock with a target price of Rs. 1,010 apiece.
The brokerage has pointed out that the company's transformation journey to becoming a leading FMCG company is on track. It said the company is going beyond its core (which has been strengthened) and focusing on building new F&B platforms, which it believes will create a greater presence across categories.
In addition, the insurer also raised its stake in Deepak Nitrite to 7.089% from 5.028% during the period from September 28, 2022, to July 11, 2023, at an average price of ₹2,152.73. This increase in stake reflects an additional purchase of 28 lakh shares, equivalent to a 2% increase.
Deepak Nitrite manufactures basic intermediates, fine & speciality chemicals, performance products, and phenolics. In its latest research note, JM Financial Institutional Securities maintained its 'buy' call on the stock with a target price of ₹2,660, indicating a potential upside of approximately 38%.
The brokerage pointed out that Deepak Nitrite is well-positioned to take advantage of favourable market conditions, including lifetime-low phenol spreads and upcoming capacities for bisphenol-a and other basic chemicals. As a result, JM Financial suggests that Deepak Nitrite presents a compelling buying opportunity.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.
