Tata Global Beverages Ltd shares today slumped almost 9 per cent after the company's quarterly results failed to meet market expectations and its decision to merge a subsidiary with itself weighed on investor sentiment.
The company's results were announced post market hours yesterday.
Tata Global Beverages Ltd's stock fell sharply by 8.6 per cent to Rs 141.35 on BSE.
On NSE, it tanked 8.7 per cent to Rs 141.10.
"For Q2 FY14 Tata Global Beverages performance was below estimate on the top-line and bottom-line front," said V Srinivasan, Research Analyst - FMGC, Angel Broking.
Tata Global Beverages had yesterday reported 51.23 per cent increase in consolidated net profit at Rs 180.03 crore for the second quarter ended September 30.
The company had posted a net profit of Rs 119.04 crore for the same period of previous fiscal.
Its net sales during the quarter under review rose to Rs 1,906.23 crore during the second quarter, as compared to Rs 1,842.57 crore during the same period of previous fiscal.
Meanwhile, the company also announced merger of its subsidiary Mount Everest Mineral Water Ltd with Tata Global Beverages.
"The boards of directors of Tata Global Beverages Limited and Mount Everest Mineral Water Limited (MEMW) in their respective meetings today, approved a proposal to merge MEMW with Tata Global Beverages," the company had said.
"Merger of Mount Everest is considered negative, so the stock is facing selling pressure," said Kishor Ostwal, CMD, CNI Research.