Shares of Tata Motors Ltd have risen over four times in the last three years, delivering multibagger returns for investors who placed their bets ahead of announcement of the 21-day lockdown by PM Narendra Modi on March 24, 2020. The lockdown, which was announced to curtail the rising number of Covid-19 cases, saw the stock falling to Rs 68.6 level on March 24, 2020. On March 9 that year, Tata Motors shares closed at Rs 105.8 level against Rs 433 today, delivering 309.26% returns to investors during the last three years.
At 1:04 pm today, the Tata Motors stock was trading at Rs 433, down 1.13 per cent against the previous close of Rs 439.45 on BSE. Market cap of the firm stood at Rs 1.44 lakh crore. Tata Motors stock has gained 12 per cent this year and risen 7 per cent in 2023. Tata Motors stock hit a 52-week low of Rs 366.05 on May 12, 2022 and a 52 week high of Rs 494.50 on August 17, 2022.
In terms of technicals, the relative strength index (RSI) of Tata Motors stands at 56, signaling it's trading neither in the overbought nor in the oversold zone. Tata Motors stock has a one-year beta of 1.2, indicating very high volatility during the period. Tata Motors shares are trading higher than the 5 day, 50 day, 100 day and 200 day moving averages but lower than 20 day moving averages.
As the stock has zoomed over four times in the last three years, investors are wondering if the scrip could rally further in volatile market conditions or should they book profit in the counter of the Tata Group stock.
Abhijeet from Tips2trade said, "Tata Motors has a strong resistance at Rs 442 on the daily charts. A close below support of Rs 430 could lead to Rs 420-405 in the coming days."
Abhishek Gaoshinde, Deputy Vice President Research at Sharekhan by BNP Paribas said, "We have a positive outlook on the company. Tata Motors' all cylinder fired simultaneously in Q3FY23 as JLR, domestic CV and domestic PV segment had reported improvement in operating performance simultaneously. With gradual improvement in semiconductor chip availability, we believe that JLR's production would also improve from Q4FY23 onwards as it is already enjoying pending orders, while its Domestic CV and PV business have been witnessing healthy traction. Any kind of value unlocking at its subsidiaries would help it in reducing its net automotive debt, which we believe would augur well for the company. We have a buy rating on the stock with target price of Rs 516."
Osho Krishan, Sr. Analyst - Technical & Derivative Research, Angel One Ltd said , "Tata Motors stock has gained nearly 12 percent in the current calendar year and is hovering just above its 200 SMA on the daily chart. After the recent run, the stock has undergone in a consolidation phase as it struggles near the cluster of its EMAs (Exponential Moving Averages) on the daily time frame. As far as levels are concerned, the swing low placed around the Rs 418-odd zone is expected to act as sacrosanct support in the comparable period. While on the flip side, a decisive breach above 445 could only trigger the next leg of rally in the counter."
Vaishali Parekh, Vice President - Technical Research at Prabhudas Lilladher has assigned a hold call to the auto stock. It has given a target price of Rs 455-460 with a stop loss of Rs 430.
“Tata Motors has once again moved past the significant 50 EMA and 200DMA level of Rs 427 quite decisively with a positive bullish candle pattern on the daily chart to indicate strength and further rise is expected in the next 2-3 sessions till Rs 455-460 zones. The near-term support can be maintained at Rs 430 levels and expect further gains,” said Parekh.
KR Choksey Shares and Securities has assigned a target price of Rs 572 to the stock, implying an upside of 31% to the current market price. “After seeing net losses for 7 consecutive quarters, Tata Motors delivered a net profit in Q3FY23 on the back of improved profitability across all three businesses. Chip supply is expected to improve further leading to volume ramp-up for JLR. Stability in commodity costs along with the focus on profitable growth should aid EBIT and free cash flows,” the brokerage said.
Mr. Ravi Singhal, CEO, GCL said," As we do a breakup of revenue, then JLR has 67% revenue. Commercial vehicles segment earns 20% revenue. Rest is contributed by passenger vehicles. The company has a first mover advantage in electric vehicles in India. It enjoys largest share in electric vehicles in India. Now, they are also focusing on electric commercial vehicles. Unlocking of the Chinese economy will lead to an increase in JLR revenue and on other hand rising inflation and rising interest rates in Euro zone will affect sales there. A combination of high interest rates and lower metal prices makes it a neutral bet. So buy on dips is advisable near Rs 380 levels with a stop loss of Rs 350 for a target of Rs 666."
Market veteran Sanjiv Bhasin has assigned a target price of Rs 575 for Tata Motors. The stock is among his key Holi 2023 stock picks.
Tata Motors reported a consolidated net profit of Rs 3,043 crore for the third quarter ended December 31, 2022, on account of robust sales across markets. The Mumbai-based auto major had logged a net loss of Rs 1,451 crore in the October-December quarter of the previous fiscal. Total income rose to Rs 88,489 crore in the December quarter from Rs 72,229 crore in the year-ago period.
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