Tata Motors Stock Breaks 3-Day Losing Streak Following Emkay's 'Buy' Upgrade

Tata Motors shares saw a much-needed comeback in the early trade on 19th September as the scrip ended its three consecutive days losing streak. Shares of this company got an upgrade by Emkay Global which actually transferred the shares from 'add' to 'buy'. The growth prospects for this shares are around ₹1,175 per share.

At 12:59 PM IST on 19th September, the shares of the Tata Motors were trading at ₹963.40 on the NSE and has surged by 0.14% from the previous close.

Emkay has increased the price target to ₹1,175, implying 22% upside. The shares of Tata Motors has corrected sharply in recent weeks, with the share price falling 13% in the past month.

While China is relatively smaller in terms of market size for Jaguar Land Rover (JLR), we believe that the profitability and debt reduction plans of Tata Motors are back on track with the domestic CV business reporting a higher top-line growth with an improved margin outlook.

In the passenger vehicle space, Tata Motors is one of the easier bets ahead of its peers with new model launch success and lower inventory levels. The favorable profitability prospects and attractive valuations make it a compelling buy at current prices, says Emkay.

Following concerns over possible erosion of margin at JLR and the domestic passenger vehicle space, which were first flagged by UBS Securities, this shares has recovered to a 'sell' recommendation. However, the target price is pegged at ₹825 per share, implying the potential for downside more than 20% from the recent closing price.

UBS remains prudent and observes that demand for the prestige models of JLR, namely the Defender, Range Rover, and Range Rover Sport, has turned out to be saturated or nearing a plateau, while the order book is at pre-pandemic levels. The brokerage also expects a step-up in discounts on Range Rover models in the near term.

On September 19, 1.9 crore shares or 0.4% of Tata Motors' total equity was traded in block deal. TML Securities Trust, through the Trust Deed, disposed off 1.14 crore shares under the scheme of fractionalisation of share entitlements.

Tata Motors Limited is one of the major automobile manufacturers and distributors in Mumbai, India. The company designs, manufactures, and sells a range of automobiles which includes cars, utility vehicles, trucks, buses, and defense vehicles among others. Its key brands are Indigo, Manza, Vista, Xenon, and Prima.

Tata Motors caters to a very wide cross-section of customers and provides vehicles for personal use as well as industrial and commercial sectors in different sectors. The company also manufactures industrial and marine engines, and it markets its products under the brands Tata Motors, Jaguar, and Land Rover. It operates in Europe, North America, the Middle East, Africa, Asia, and South America.