Tata Motors shares have seen a steady rise, with brokerages reaffirming their positive outlook on the company’s growth trajectory. The automotive giant, recognized as the country’s leading player in the electric vehicle (EV) sector, recently unveiled ambitious investment plans totaling between Rs 16,000 crore and Rs 18,000 crore for its EV division until the fiscal year 2029–30.
In early trading on June 12, Tata Motors shares experienced a nearly 1% increase, marking the fifth consecutive session of gains. Analysts continue to maintain an optimistic stance on the stock, citing robust growth prospects highlighted during the company’s recent investor meet.
Jefferies, among the brokerage firms, has issued a buy recommendation for Tata Motors, setting a target price of Rs 1,250 per share. They emphasize the company’s commitment to enhancing its brand presence and bolstering profitability across both passenger vehicles (PVs) and commercial vehicles (CVs) segments. Tata Motors aims to capture 16% of the PV market by fiscal year 2027 and aims for further growth to 18-20% by fiscal year 2030.
Furthermore, Tata Motors targets achieving a double-digit EBITDA margin in both its CV and PV (Internal Combustion Engine) segments and aims to attain profitability in its EV segment by fiscal year 2026.
The management expressed confidence in achieving financial stability, targeting to become net debt-free by fiscal year 2025. Moreover, the company aims to secure a market share exceeding 25% across various segments.
Morgan Stanley, while assigning an equal-weight rating with a target price of Rs 1,100 per share, suggests that Tata Motors’ individual business units are now self-sufficient, potentially paving the way for demergers to further streamline operations. Analysts anticipate a favorable macroeconomic environment to prolong the commercial vehicle (CV) business cycle.
IncCred Equities highlights the impressive return on capital employed (RoCE) of 36% achieved by Tata Motors’ commercial vehicle (CV) division despite stagnant volume growth over the past year. Although the demerger process may take some time, they express a preference for the CV business post-demerger. Notably, the gradual recovery in Tata Motors’ India PV business and the performance of Jaguar Land Rover (JLR) have contributed to a revised rating.
As of around 9:30 am, Tata Motors shares were trading at Rs 995, marking a 0.8% increase from the previous close on the NSE. Over the past week, Tata Motors shares have surged by six percent.
(Note: This rewrite paraphrases the original news piece without reproducing it verbatim.)