Indian equities underperformed in the last week weighed by the slump in the Infosys stock and worse-than-expected first quarter earnings reported by several companies. The shares of India’s second-largest information technology firm Infosys tumbled about 10% on Friday after company’s CEO Vishal Sikka stepped down. He said he was leaving because of “a continuous stream of distractions and disruptions” that were hindering management of the company.
Amid this choppy market movement in the last week, shares of the mid-cap stock Tata Global Beverages have zoomed 25% in mere five trading sessions. The stock of non-alcoholic beverages company rose to Rs 194.5 on Friday, 18 August 2017, up 24.63% in five trading sessions from Rs 156.05 on previous Thursday, 10 August 2017. The benchmark Sensex has declined 0.23% in the same period. Shares of Tata Global Beverages extended gains on Monday, gained over 3% to the all-time high of Rs 200.45 on BSE. Tata Global Beverages is a component of BSE mid-cap index.
Recently last week, an official of Tata Global Beverages Limited said that the company will review the operations of its loss-making associates engaged in plantation activity. “Amalgamated Plantations is continuing to lose money. There is a need to take a call on both the plantation associates,” chairman of Tata Global Beverages N Chandrasekaran told shareholders at the company’s AGM on Friday last week. Chandrasekaran further added that although the company’s market share is 23% in tea, it is making losses in other business units. “If required, the company will prune its portfolio and stay focussed. We will also focus on the returns.”
Earlier this month Tata Global Beverages reported a rise of 13.2% in the net profit in the April-June quarter to Rs 142 crore from Rs 126.29 crore in the corresponding period last year. The beverages company attributed improved operating performance, higher exceptional income and lower losses from its JV associates helped the firm to post a decent profit. However, net income for the first quarter of FY 2018 stood at Rs 1718.76 crore, down marginally from Rs 1756 crore in the comparable quarter last year.
The company’s joint ventures, Tata Starbucks and NourishCo, had a strong quarter with a turnover growth in excess of 20 per cent each, L Krishnakumar chief financial officer of Tata Global beverages said.