What to do with Tata Global Beverages' stocks?

Tata Global Beverages after posting very good set of results is one of the stocks that can be looked at by long term fundamental investors. Barring the wrong reasons for which the stock has been in news, fundamentally the stock is in good shape.

If one looks deeper into the reasons why the stock delivered such good numbers, lowering commodity prices have aided the increase in margins for the stock. The company’s sales have increased in volume terms but in value terms the company’s sales actually have decreased by 2.2 per cent.

The material cost has fallen by almost 9.4 per cent even as the advertising and other expenses have declined which led to increase in operating profits by 34 per cent.

Another reason that helped company post good margin is the drop in GBP i.e British pound

Demonetisation which has affected most of the businesses will affect the company’s performance somewhat, which will be reflected in the coming quarter numbers; and also the Tata vs Mistry saga is a concern, which may impact the stock performance sentiment wise in near term.