Business

Tata Motors Shares Surge Over 8%; Know why

Shares of Tata Motors soared 8% in Monday’s trade following the automaker’s global wholesale data. The company said in a press release that its wholesales, including Jaguar Land Rover increased 8% YoY to 3,61,361 units. Moreover, several brokerages turned positive on the Tata Group stock.

Besides, Motilal Oswal Securities said in a note that all three businesses of Tata are in a mode of recovery. “While the India CV business will see a cyclical recovery, the India PV business is seeing a structural recovery. JLR is also witnessing a cyclical recovery, supported by a favourable product mix. However, supply-side issues will delay the recovery process. While there will be no near-term catalysts from the JLR business, the recovery in the India business will continue,” as mentioned in the note.

The company is trading at 13.7 times its expected FY25 consolidated EPS and 16.9 times its estimated FY24 consolidated EPS, according to Motilal Oswal Securities. The company gets a ‘Buy’ recommendation from the firm with a Rs 525 price objective.

According to Tata Motors, global wholesale sales of passenger cars reached 1,35,654 units in the March quarter, an increase of 10% year over year. 1,07,386 automobiles were sold through Jaguar Land Rover’s global wholesales. (including CJLR volumes of 12,737 units). According to Tata Motors’ press announcement, Land Rover wholesales for the quarter were 91,887 automobiles, compared to 15,499 vehicles for Jaguar.

Following the development, Goldman Sachs increased its price objective on the stock from Rs 480 to Rs 550, taking into account JLR’s increasing volume outlook.

Shares of Tata Motors increased 7.62% to a high of Rs 470.90. The stock has a target price of Rs 508 set by Nomura India. The stock is valued by CLSA at Rs 544. The stock has a target price of Rs 438 from JPMorgan and a target price of Rs 475 from BofA Securities.

Global wholesales of all commercial vehicles and the Tata Daewoo line, according to Tata Motors, were 1,18,321 units in the March quarter, a 3% YoY decrease.

Also Read: RBI Surveys Predict Optimistic Business Situation and Strong Credit Demand in FY24

Malika Sahni

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