Why brokerages are bullish on Tata Motors stock despite Rs 1,516-crore Q3 loss

Tata Motors stock has fallen after four times of consecutive gain. The stock opened up having a lack of 2.03% at Rs 507 today from the previous close of Rs 517.50 on BSE.

The stock has fallen after four times of consecutive gain. The stock opened up having a lack of 2.03% at Rs 507 today from the previous close of Rs 517.50 on BSE.

It further fell 3.66% to Rs 488.55 on BSE.

Tata Motors share is buying and selling greater than 5 day, 20 day, 50 day, 100 day and 200 day moving averages. Tata Motors stock has acquired 82.9% in a single year and risen 6.07% forever of the year.

Total 8.56 lakh shares from the firm altered hands amounting to some turnover of Rs 43.40 crore on BSE.

Tata Motors posts internet lack of Rs 1,516 cr in Q3 among nick shortage

The stock hit a 52-week a lot of Rs 536.50 on November 17, 2020 along with a 52-week low of Rs 255.55 on Feb 1, 2021.

YES Securities has provided a buy call having a target of Rs 597. “Tata Motors remains as our top pick, given its improving India franchise, early leadership in EVs in India, and JLR’s aggressive cost controls. Standalone clients are in sweet place brought by healthy cyclical recovery in PV and CV whereas favorable product cycle to assist drive JLR outperformance. Despite ongoing outperformance, TTMT is attractive play among OEMs. We raise FY23/24 EPS by 1%/5% to factor in better ASPs and cost control and estimate revenue/EBITDA CAGR of 17%/19% in FY21-24E. We maintain BUY with target of Rs597 (v/s Rs 575 earlier),” the brokerage stated.

Motilal Oswal is bullish around the stock having a target of Rs 600 publish its Q3 earnings.

“Tata Motors should witness a gentle recovery as supply-side issues ease and commodity headwinds stabilize (for that India business). It’ll take advantage of: a) a macro recovery, b) company-specific volume/margin motorists, and c) a clear, crisp improvement in FCF and leverage both in JLR along with the India business. The stock trades at 13.4x FY24E consolidate P/E and three.5x EV/EBITDA. We maintain our Buy rating, having a TP of INR600/share (Mar’24E-based SoTP,” the financial services firm stated.

The Tata Group’s auto arm reported a loss of revenue of Rs 1,516 crore (due to shareholders) for that quarter ending December 31, 2021, as semiconductor shortages crimped the Indian automaker’s ability to benefit from the pandemic-driven interest in personal vehicles.

The firm had reported a internet profit of Rs 2,906 crore last year when an easing of coronavirus-related limitations had brought to some pick-in sales. Sequentially, the automaker’s loss narrowed from Rs 4,412 crore within the second quarter of the fiscal year.

Consolidated total revenue from operations declined nearly 5 percent to Rs 72,229 crore versus Rs 756,53 crore from last year.

The consolidated EBITDA, or earnings before interest, taxes, depreciation, and amortization margin was at 12 percent.

When it comes to outlook for the following quarter, the automaker stated the demand remains strong despite near term concerns from Omicron spread.

“The semiconductor supply scenario is improving progressively although inflation worries persist. During the last 2 yrs, the resilience from the business has improved, which is now intrinsically more powerful. With concerted actions in position to deal with the near-term supply and price challenges, we predict performance to enhance further in Q4FY22 and beyond,” Tata Motors stated.

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