Tata Motors shares surged to a 52-week high on Thursday (July 25) as global brokerage Nomura double upgraded the stock to ‘buy’. Nomura has raised its target price for Tata Motors to Rs. 1,141, up from Rs. 1,057, citing stable performance and fair value.
Tata Motors recently announced its financial results for the March quarter, with the company’s consolidated net profit rising 46% to Rs. 17,529 crore from Rs. 12,033 crore in the same quarter last year. The company, in its guidance for FY25, said it is cautiously optimistic on domestic demand for the full year and expects the first half to be relatively weak.
In its upgrade, Nomura said Jaguar Land Rover (JLR) may face demand risks and growth in commercial vehicles will also moderate. However, Morgan Stanley also downgraded Tata Motors to Equity Weight from Overweight, but raised the target price to Rs. 1,100 from Rs. 1,013.
Kotak Equities has also issued an add rating on the stock, along with a target price of Rs. 1,100. Kotak said, “We expect stable JLR business performance during FY2025-26, led by improving mix and cost control measures, market share gains in PV and CV segments, and healthy performance due to net cash balance sheet by FY2025.”
Motilal Oswal has also issued a neutral rating on Tata Motors, along with lowering the target price to Rs. 955. The company says that JLR margins are expected to remain stable during FY2024-26, as cost pressures are increasing while investing in demand creation, mix is normalizing and EV ramp-up is going to happen, which could be margin-draining.
Tata Motors shares have jumped 120% in the last one year to Rs 950.50 per share. The company announced on June 1, 2024 that total sales in domestic and international markets in May 2024 were 76,766 vehicles, up from 74,973 units in May 2023.
The 52-week high price of Tata Motors stock was Rs. 1,065.60 per share on March 5, 2024 and the 52-week low price was Rs. 2,065.60 per share on March 2, 2024. The price of Tata Motors was Rs. 532.80 per share on June 2023. The stock has declined more than 6% in the last one month, while it has gained 35% in the last 6 months.
Recommending investing in Tata Motors stock, Nomura and Kotak Institutional Equities have issued neutral and add calls, respectively, along with setting target prices at Rs. 1,141 and Rs. 1,100 per share, respectively.
