Tata Motors share prices nosedived 8% in early trade after the auto giant reported a 22.5% YoY decline in net profit for Q3FY25. The auto major clocked a miss in realisation/margin in JLR and the India CV division. The management has cut FY25E JLR revenue guidance by 3%. No points for guessing, the results fell short of market expectations, resulting in most brokerages taking on cautious stance.
In the early hours of today’s trading session, Tata Motors share price opened at Rs 688.65, a sharp decline of 63.85 points or 8.49%. Furthermore, the stock is now 0.8% away from its 52-week low of Rs 683.20, highlighting of a significant downward pressure in early trading.
What do brokerages say?
Following the announcement of the financial results for the quarter ending December 31, 2024, leading brokerages have provided their revised ratings and target prices for Tata Motors. Let’s take a look into it detail:
Jefferies: Downgrades to underperform
International brokerage firm, Jefferies has downgraded Tata Motors to an Underperform rating, drastically reducing its target price from Rs 1,000 to Rs 660 per share.
Also ReadMarkets cautious, Nifty near 23,150, Sensex down 60 points; Tata Motors slides 7.5% Nuvama retains Reduce rating, cuts target price
Nuvama has retained the ‘Reduce’ rating on the stock with an SotP-based Target price of Rs 720. This is lower than their earlier estimate of Rs 750. They are building in a “muted 2% revenue CAGR over FY25–27E, owing to volume decline at JLR (-4% CAGR) and muted growth in the India CV” sector. Moreover, they see the CV sector to be muted, ” owing to moderate road construction spends and a high base. This weakness in demand outlook should also increase costs led by greater marketing & sales promotion spends in global and domestic markets. We expect a 2% EBITDA CAGR as the negative impact of higher marketing spends and lower scale is likely to be offset by cost-saving efforts.”
Morgan Stanley: Balanced approach with a Cut in target
Morgan Stanley has maintained an Equal Weight rating but lowered the target price from Rs 920 to Rs 853 per share.
Goldman Sachs: Neutral view
The brokerage firm, Goldman Sachs (GS) has maintained a Neutral stance on Tata Motors, setting a target price of Rs 800 per share.
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