Motilal Oswal Retains 'Buy' On Tata Consumer, Says Strong Harvest, Lower Tea Prices To Aid Profitability In H2

Tata Consumer’s tea business displayed resilience amid inflationary pressures. The challenging demand environment, with tea prices increasing ~30% YoY in the last procuring season, led to consolidated Ebitda margins contaracting by ~260bp in Q1 FY26, of which ~160bp was attributable to the inacrese in tea prices with the company only being able to pass on ~70% of the cost increase to its customers.