However, going forward, Tata Tea's dividend has to be observed carefully. Thats because although the consolidated profit would be quite better as the interest savings and interest gain can lead to a gain of about 20-30 rupees a share, the standalone book will not be very good. thats because, the cash is stacked with TTGB Limited and not with tata tea, so most of interest income will accrue to TTGB and not to Tata Tea standalone book. As dividend has to be paid out of standalone book, so we need to be bothered about dividend......

 

If ECB norms get relaxed, the funds may be bought home and lent at quite higher levels. That financial engineering is possible.

 

Tata Tea on the consolidated level is in an absolute wonderful state.

 

Also, look out for how TCL do engineering with EOC. That can also be a spinner for Tata Tea as the result of any engineering gets reflected in tata tea's consolidated book.

 

Infact, if I have to lay down my premise for recommending Tata tea, it will go like this:

 

1.Funds position

2.Wonderful subsidiaries and step down subsidiaries.

3.Tremendous scope for unlocking value.

 

If this stock falls to 600-odd levels, this stock can be accumulated. You may set level 2 at 20 p.c. discount to 600, and level 3 at 30 p.c discount to 600.

 

 

 

How can a 'newbie' guide other 'newbies'?????

 

I just put down my observation regarding Tata Tea, thats all.

 

investors interested in tata tea, shall simply look beyond its tea operations and just think about the value that this company may unlock, through corporate action, through financial engineering, through business re-organistion, through new geography penetration, through exploration of alternate 'health-and wellnessness focussed beverages'.

 

 

Its global brands such as Tetley Tea, Tata Tea, Himalayan water and the Good Earth speciality teas and coffees will be supported by its regional and speciality brands such as Eight O’Clock Coffee in the US, Vitax herbal tea in Poland, Jemca tea in the Czech Republic, and Indian brands such as Chakra Gold and Kanan Devan, said Peter Unsworth, chief executive officer of the UK-based Tetley Group, now a subsidiary of Tata Tea Ltd.