The shares of the Largest Automobile Manufacturer gained around one percent to hit a fresh all-time high of Rs 687.35 on Wednesday trade after CLSA gave a ‘buy’ recommendation with an upside of 24 percent.
At 10:52 a.m., On Thursday, Tata Motors Ltd shares were trading at Rs 678.65, down 0.40 percent from the previous close on the National Stock Exchange.
The company’s shares have delivered a return of 28 percent in six months and 60 percent in a year.
The company’s revenue climbed by 32 percent year on year, rising from Rs 79,611 crore in Q2FY23 to Rs 105,128 crore in Q2FY24. During the same period, net profit increased from a loss of Rs 1,004 crore to a profit of Rs 3,783 crore.
CLSA has maintained a ‘buy’ rating on Tata Motors with a target of Rs 841 per share with an upside of 24 percent based on Tuesday’s trading price of Rs 678.20.Based on the company’s JLR business improvement in retail volumes in October 2023, from the previous year.
The rationale behind providing such a recommendation is
● The brokerage has seen a positive outlook on the company’s Jaguar Land Rover (JLR) business which has increased its retail volumes by 14.1 percent year on year in October 2023.
● The Tata Motors-specific geographic segments have shown substantial growth for JLR, with volumes in the UK and EU surging by 65 percent and 29 percent, respectively, compared to the previous year.
● Brokerage forecasts a positive financial trajectory on the company’s JLR business, as its net debt has decreased by £300 million, indicating a potential shift to a net cash position by FY25.
● The CLSA expects a solid margin, driven by an upgrade in consensus earnings estimates based on the company’s confidence in gaining market share in the second half of FY24 due to the recent new launches in both passenger vehicles (PVs) and electric vehicles (EVs) segment, and a refocus on commercial vehicles (CV).
As of September quarter 2023, Ace investor Rekha Rakesh Jhunjhunwala holds 53,25,600 shares, i.e. equivalent to 1.60 percent of the company.
As per the recent shareholding pattern, The Promoters of the Company own 46.38 percent of the stake, while foreign institutional investors hold an 18.4 percent stake and Retail investors hold 17.7 percent of the stake.
Tata Motor Ltd is a leading global automobile manufacturer that provides the global market with an extensive and varied range of automobiles, trucks, buses, sport utility vehicles, and defense vehicles.
Tata Motors has a strong global network with operations in India, the UK, South Korea, South Africa, China, Brazil, Austria, and Slovakia.
Written by Omkar Chitnis
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
