Tata Motors has posted its Q4 FY25 Results with Strong QoQ Net Profit Growth of 56 percent, However, the Stock’s Reaction to the Results has been muted with a decline of 2.10 percent from yesterday’s close.
Global Brokerage firm Jefferies has shared a Brokerage report on the Stock following its results. Check out the Target level and its rationale.
Brokerage Rational & Target
Global Brokerage firm Jefferies maintains its Underperform rating on Tata Motors Ltd and has increased the target price from Rs. 625 to Rs. 630, which is a downside of 10 percent from current levels of Rs. 698. The Brokerage firm noted that the company saw a slight dip in EBITDA during the fourth quarter, however, it still delivered strong free cash flow, which reflects solid cash generation. Looking ahead, they expect a challenging environment due to softer truck demand in India and rising competition in the EV space.
Based on these factors, Jefferies has rationally lowered its FY26–27 EBITDA estimates by 8 percent to reflect potential pressure on operating performance. However, it has raised EPS estimates by 3–4 percent, suggesting expectations of better cost efficiency or improved earnings quality despite the operating headwinds.
Financial Highlights & Dividend Recommendation
The company reported a 0.39 percent YoY increase in revenue from Rs. 119,033 Crore in Q4FY24 to Rs. 119,503 Crore in Q4FY25. On a QoQ basis, the company reported an increase of 6.12 percent in revenue from Rs. 112,608 Crore in the previous quarter. Their Net profit saw a decrease of 51.18 percent YoY from Rs. 17,528 Crore to Rs. 8,556 Crore for the same period. On a QoQ basis, the company reported an increase of 55.98 percent in Net profit from Rs. 5,485 Crore in the previous quarter.
The QoQ jump in net profit was mainly due to higher revenue and improved operating efficiency. Better cost control and the YoY decline in net profit from Q4FY24 to Q4FY25 was mainly due to the presence of a large one-time deferred tax gain that had boosted profits in Q4FY24. The Board has recommended a dividend of Rs. 6 per share, or 300 percent when compared to the face value of Rs. 2 per share. The dividend will be subject to approval of the shareholders at the AGM.
About the Company
Tata Motors is one of India’s largest commercial vehicle manufacturer and ranks among the top three in the passenger vehicle segment. It has a significant global presence, with operations in over 125 countries with 9,400 touchpoints, and 7 Assembly facilities.
The company’s notable subsidiaries include British Jaguar Land Rover and South Korean Tata Daewoo. Tata Motors has joint ventures with Hitachi (Tata Hitachi Construction Machinery) and Stellantis, which makes vehicle parts for Fiat Chrysler and Tata-branded vehicles.
Written By Abhishek Das
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.
