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Best Tea Stocks To Invest In India In 2024

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Published Date: 24 May 2024Updated Date: 30 Dec 20246 mins readBy MOFSL

The tea industry in India is poised for continued growth. Its strong cultural foothold and increasing demand have allowed companies in this segment to try new premium products. As a high-demand product, investing in tea company stocks is a wise idea.

 

Best tea stocks in India

1. Tata Consumer Products

Tata Consumer Products is part of the prestigious Tata Group. The company sells many tea products, including black, green, and specialty teas. It dominates the regional market through its sub-brands, Tata Tea Gold and Tata Tea Premium. Additionally, Tata Consumer Products' sub-brand Tetley is a leader in the UK and Canada.

Experts usually recommend investing in this company's shares due to its foothold in other FMCG products.

In the fourth quarter of the financial year 2023, this company's combined sales were INR 3,927 crores, translating to a net profit of INR 212 crores. The one-year absolute return for this company's stock is 35.83%, with shares currently trading at around INR 1068.90.

 

2. Jay Shree Tea & Industries

Jay Shree Tea & Industries Limited is a member of the well-known B.K. Birla Group. Established in 1945, the company is now the third-largest tea producer in the world. Jay Shree Tea’s presence is not limited to the Indian market but extends to East African markets as well.

Its product portfolio includes black, green, white, and oolong teas. It also sells specialty teas like Darjeeling, Assam, Cachar, and Dooars teas.

In the third quarter of the financial year 2022-23, Jay Shree Tea generated revenue of INR 236.17 crores, while the net profit, which was less impressive, stood at INR 19 lakhs. The absolute return for the 52 weeks of this stock is 15.33%.

 

3. CCL Products (India)

CCL Products is a well-known company in the coffee industry. It was established in 1994 and has since expanded its reach to export to over 90 countries.

While tea is also available in their product range, what sets them apart is their selection of 900 coffee blends. Among these, the four most sought-after blends include flavoured coffee, instant coffee, specialty coffee, and roast and ground coffee.

This stock's annual revenue for the previous quarter was INR 730.83 crores, and its net income after taxes and interest payments was INR 65.64 crores. The company has not fared well on the price chart in the previous 52-week period. 

 

4. Andrew Yule

Headquartered in Kolkata, Andrew Yule & Company Limited is a diversified conglomerate with a history dating back to 1863. The company operates not only in the tea segment but also in power, telecom, engineering and environment, electrical, lubricants, industrial electronics, turnkey contracts, financial services, and printing sectors.

In the December quarter of the previous financial year, the company made a revenue of INR 98.38 crore. 

 

5. Goodricke Group

This West Bengal-based company is part of Camellia PLC UK. Goodricke Group offers Darjeeling brands like Goodricke Castleton, Roasted, and Margaret’s Hope. They also produce Black (CTC) tea, including Goodricke Khaass, Goodricke Zabardast, and Goodricke Chai.

Although the company has generated decent revenue, it failed to profit due to high operating expenses and debts.

 

6. McLeod Russel

McLeod Russel is a member of the Williamson Magor Group. This company is known for its premium teas, such as Assam Classic Black Tea, Indian Masala Chai, Earl Grey, and English Breakfast Tea.

McLeod Russel is a penny category stock that has delivered around 16.75% return in the past.  

 

7. Neelamalai Agro Industries

Neelamalai Agro Industries Ltd. is another famous company that cultivates and produces tea. They operate mainly through their Katary Estate and Sutton Estate in the Nilgiris District of Tamil Nadu. Combined, these estates cover 569.42 hectares and produce around 19,00,000.00 kg of tea annually.

The company’s product lineup includes Orthodox and CTC teas, with a production split of 90% Orthodox teas and 10% CTC teas. They also produce specialty teas like Silver tips, SFTGFOP (semi-fermented muscatel-flavoured teas), and oolong teas.

In the December quarter of the previous financial year, the company made a profit of Rs 18.19 crores and achieved a net income of 9.19 crores.

 

Conclusion 

When selecting tea stocks, you must consider company fundamentals, historical performance, growth potential, and market trends. It is also wise to look at how these companies innovate and adapt to new consumer trends, such as organic and specialty teas.

 

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Disclaimer: The stocks, companies, or financial instruments mentioned in this blog are for informational purposes only and should not be considered as investment recommendations. It is advised to consult with your financial advisor before making any investment decisions. Investment in securities markets are subject to market risks, read all the related documents carefully before investing. Investors are strongly encouraged to carefully read the risk disclosure documents prior to participating in market-related investments or trading activities. Due to the volatile nature of financial markets, no guarantees can be made regarding investment returns. Motilal Oswal Financial Services Ltd. does not offer any assured returns on market-linked securities. Please note that past performance of stocks or indices is not indicative of future results.
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