(Bloomberg) -- The aroma of Indian tea is attracting investors.
Two Nomura Holdings Inc. investment units on Thursday bought about 8 percent of McLeod Russel India Ltd., the world’s top grower, underlining the bullish outlook for the sector.
Shares of McLeod Russel and rivals including Goodricke Group in November posted their best monthly advance in at least a decade amid production losses in India and Kenya, the largest exporter of black tea.
Smaller output have led to local prices outstripping costs for the first time in three years, Kamal Baheti, chief financial officer at McLeod Russel, told Bloomberg Quint. A shortage abroad has boosted shipments from India, which could worsen domestic supplies and boost the deficit of 40 million to 50 million kilograms, he said.
Robust demand and the prospect of tea prices staying elevated after years being relatively stable are attracting investors to tea stocks, said Paras Bothra, a vice president of equity research at Ashika Stock Broking in Mumbai.
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