Tata Motors share price rose more than 2% on Wednesday, adding 7% in a week, as brokerages maintained a bullish stance on the stock amid better growth prospects highlighted by the company in an investor meet.
While Tata Motors’ Indian business has already become net debt free by FY2024, it has set a target for Jaguar Land Rover (JLR) to become net debt free by FY2025.
Tata Motors aims to grow up the passenger vehicle (PV) industry by 2X on new nameplates across ICE, CNG and EVs with a development of 80% of the addressable market by FY2030 from 53%. It aims to progress profitability with double-digit margins in the combined PV and EV business by FY2030. It also targets the electric vehicle (EV) business to accomplish EBITDA get by FY26.
Better growth prospects in CV prompt brokerage firm MK Global Financial Services to upgrade its target multiple to 12.5x. It has to raise the rating on Tata Motors shares to ‘Add’ from ‘Low’ earlier and raise the Tata Motors share price target to ₹1,050 per share from ₹950 earlier.
According to JM Financial, Tata Motors’ domestic business has a comfortable net cash position. It maintained ‘buy’ rating on Tata Motors stock with an unchanged target price of ₹1,200 per share for March 2025.
Motilal Oswal Financial Services expects JLR margins to remain stable over FY26-26, given rising cost pressures as it invests in demand generation, normalizing mix and EV rampup, which are likely to be margin-weakening.
Motilal Oswal said that “Even in India, both PV and CV businesses are witnessing a turn down in demand. We have assumed flat margins for the Indian business over our forecast period. While there is no doubt that Tata Motors has delivered extremely strong performance across its key segments in FY2014, the above headwinds could hurt its performance going forward,”.
The brokerage firm reiterated its ‘neutral’ call on Tata Motors shares with a FY26E target price of ₹955 per share. Kotak Institutional Equities has maintained its FY2025-27E EPS estimates. Overall, it expects fiscal 2025-27E to perform well, led by improving JLR business performance, stable demand trends; Market share increased in PV and CV segments; and net cash balance sheet by FY2025E.
Nuvama Institutional Equities raised FY25E EBITDA estimates by 2%, taking into account better realization/margins, but kept FY26E EBITDA unchanged. This creates moderate revenue and EBITDA CAGR of 9% and 13% in FY24-26E vs. 21% and 25% in FY21-24.
