Nomura assigns 'buy' rating on McLeod Russel India

Foreign brokerage Nomura has assigned a buy rating on tea manufacturer McLeod Russel India with a target of Rs 429 per share. The stock ended 2.8% higher at Rs 323.75 on the BSE on Monday.

"We believe tea prices will remain firm in the second half. We expect another uptick in FY14 as the impact of crop loss globally is likely to result in lower inventory even as demand picks up in the winter. Some tea producers have indicated that tea prices are already up by more than Rs 10 in the past three weeks," the Nomura report said.

According to analysts, limited land supply and steady demand are likely to result in an upward bias in tea prices.