Shares of Tata Motors plunged as much as 4 percent to Rs 623 on Friday, hitting a 52-week low and extending their losing streak for the fifth straight session. The stock has now fallen in seven of the last eight trading days. The sharp fall in Tata Motors’ stock follows a lacklustre third-quarter performance, cautious guidance, and pressure from a broader market correction.

With this decline, Tata Motors has tumbled 46 percent from its July 30 peak of Rs 1,179, erasing nearly Rs 2 lakh crore in market capitalisation since then. February has been particularly rough, with the stock slipping close to 12 percent—its worst month since October, when it had dropped 14 percent.

This also marks its seventh consecutive month in the red, the longest losing streak since 2015, when the stock slumped for seven straight months before staging a recovery.

Despite the ongoing concerns, international brokerage CLSA last week upgraded the stock to a high-conviction 'outperform' rating from 'outperform' suggesting positive levers for growth.

CLSA analysts suggest that this is an attractive entry point despite near-term challenges. Jaguar Land Rover (JLR) is currently trading at , significantly below its normative multiple of 2.5 times. At the current stock price, JLR’s implied per-share value stands at approximately Rs 320, compared to a target valuation of Rs 450 in a sum-of-the-parts analysis.

This provides a cushion against risks such as US tariff hikes and weaker-than-expected demand and margins. Additionally, CLSA expects a cyclical recovery in the medium and heavy commercial vehicle segment from , which could start reflecting in valuations in the coming quarters.

In Q3, the company reported a 22 percent year-on-year drop in consolidated net profit to Rs 5,451 crore for the third quarter of , missing analyst estimates. The automaker’s performance was weighed down by weaker margins and subdued Jaguar Land Rover (JLR) volumes, despite a sequential improvement. Revenue from operations rose 2.7 percent on-year to Rs 1,13,575 crore, driven by a modest improvement in overall sales.

The segment recorded a 4.3 percent decline in revenue to Rs 12,354 crore. Despite this, EBITDA margin improved by 120 basis points to 7.8 percent, helped by cost-cutting measures and PLI incentives. The company’s electric vehicle (EV) sales in the personal segment rose 19 percent on-year, though fleet sales were impacted by the expiry of FAME II subsidies.

At about 2:45 pm, shares of the company were trading at Rs 625, lower by 3.56 percent from the last close on the NSE.

Published On - February 28, 2025 

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