Tata Motors Stock Price Today: In today’s business, there is a huge decline in the shares of Auto sector giant Tata Motors. Due to weak results, the stock fell 9 per cent to Rs 683 today. Earlier on Wednesday, it closed at the price of Rs 753. The company’s profit in the December quarter has declined by 22 per cent in the December quarter due to the weak performance of Jaguar Land Rover (JLR). After the results, the brokerage house has also alerted about the stock and has reduced both rating and target price.
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Rating and target price of brokerage house
Gold man sax
Rating: Neutral
Target Price: Rs 800
Clsa
Rating: Outperform
Target Price: Rs 930
Nuvama
Rating: Reduce
Target Price: Rs 720
Jefferies
Rating: Underperform
Target Price: Rs 660
Morgan Stanley
Rating: Equal Weight
Target Price: Rs 853
UBS
Rating: Sell
Target Price: Rs 760
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What to say of brokerage house
Brokerage house Nuwama has reduced the FY25 Ebitda target for Tata Motors by 4 per cent. Nuwama has reduced Revenue and Ebitda CAGR by 2 % during FY 2020-27. For JLR, we expect volume constraints due to lack of order book, shutdown of ‘Jaguar’ model and low demand in all segments. The company believes that Tata Motors’ India Commercial Vehicle (CV) division will be performed dull (1 per cent CAGR) due to the Moderate Road Construction Spend and High Base.
Brokerage house Morgan Stanley said that Tata Motors has reduced the revenue of FY 2025 for JLR and ROCE (Return on Capital Employed) guidance. Brokerage said that the third quarter figures have been weaker than expected. Brokerage House UBS said that the company’s commentary for the fourth quarter between indefinite financial years 2026 and 2027 is ambitious. In the next financial year, China’s recovery will be an important factor to give 10 % EBIT margin for JLR.
Tata Motors: Effect of giving more discounts
Experts say that Tata Motors and JLR gave more discounts to attract customers, which led to some improvement in demand, but it affected the company’s profits. Since JLR contributes two-thirds of the total income of Tata Motors, its weak performance directly affects the company’s financial position.
However, the company hopes that JLR’s wholesale sales will improve in Q4 FY25. However, the company remains cautious about the demand situation in China. According to Tata Motors, the company will try to improve its performance through better supply chain management and cost control in the coming quarter.
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Tata Motors: How to be the results of the company
Tata Motors’s profit declined by 22 per cent to Rs 5578 crore in the third quarter (Q3) of FY 2024-25, which was Rs 7,145 crore in the same period last year. Profits have declined due to increasing expenses and weak performance of Jaguar Land Rover (JLR). However, the company’s total revenue increased to Rs 1,13,575 crore, which was Rs 1,10,577 crore in the same quarter last year. The total expenditure of the company was Rs 1,07,627 crore, which is more than Rs 1,04,494 crore in the previous year. Due to increasing expenses, there was a decline in profit.
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JLR’s weak performance
The biggest shock for Tata Motors was its luxury vehicle brand Jaguar Land Rover (JLR), whose pre-tax profit declined by 12 per cent in this quarter. Its profit was affected due to reduction in sales of JLR and high discounts. Apart from this, domestic car business also recorded a decline of 38 per cent, which negatively impacted the company’s total profit.
(Disclaimer: Investing in stock is advised by brokerage house. These are not private views of financial express. There are risks in the market, so take the opinion of experts before investment)