The honeymoon period for Tate & Lyle's new chief executive turned even sweeter on Tuesday when shares in the sugar-to-ethanol group jumped 5%, helped by an upgrade from Credit Suisse.

The investment bank raised to "outperform" from "neutral" its rating on Tate shares, to which it gave a target of 550p, citing improved trading, a dividend yield of more than 5% and its new boss, Javed Ahmed.

"What's not to like?" Credit Suisse said in a 16-page report.

'Highly regarded' 

The note, which followed upgrades from Citigroup and Panmure Gordon two weeks ago, helped Tate shares jump 23.7p to 473.8p, their highest since May last year.

A leading investment manager, whose fund has a large position in Tate & Lyle, told Agrimoney.com: "Mr Ahmed is highly regarded, that's one reason people are getting behind the shares.

"There is also the rising sugar price. And there is also talk that trading has got better for them."

'Gold standard'

One advance Mr Ahmed might bring is to ensure Tate's investments achieve better returns, Credit Suisse said.

"Significant expenditures have gone in over the last few years on projects that have yielded little or no return," the note said.

Reckitt Benckiser, meanwhile, "sets the gold standard on capital allocation, working capital levels and indeed return on assets".

Corn syrup sweetens

The report also noted an improvement in demand for high fructose corn syrup, which Tate refines from corn, as a sweetener following the surge in sugar prices.

In Mexico, the "strength of the peso and high sugar prices are beginning to encourage the local bottlers to switch to corn syrup from sugar to sweeten their beverages.

"The importance of these exports cannot be overstated," Credit Suisse said, noting the profitability improvements that come to Tate with higher usage of processing capacity.