Tata Motors shares in focus post JLR Q3 sales data; stock price target Rs 900, says Motilal Oswal

Tata Motors Ltd shares will be in focus on Tuesday morning after the British arm Jaguar Land Rover (JLR) reported a 27 per cent year-on-year (YoY) jump in total wholesales at 1,01,043 units for the December quarter. While the a wholly owned subsidiary of Tata Motors did not share a breakup between Jaguar and Land Rover wholesales, the company delivered its highest wholesales in 11 quarters during the period, Tata Motors said in a BSE filing.

Tata Motors said its order book continues to reflect strong demand for JLR products with 1,48,000 client orders

at the end of the third quarter. This has reduced from 1,68,000 at the end of the second quarter, reflecting increased order fulfilment to clients. Demand for Range Rover, Range Rover Sport and Defender remains particularly strong, representing 76 per cent of the order book, Tata Motors said in a filing to BSE.

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"We believe that while JLR will continue to see a healthy recovery, growth will moderate in Tata Motors' PV and CV businesses in the coming years due to normal base and slowdown in the lower end PV and LCVs. The growth in JLR is likely to be supported by gradual recovery in global PV demand, a strong order book, and a favourable product mix," Motilal Oswal said.

Wholesale volumes for Range Rover Sport were 16,921, up 49 per cent. For Range Rover, wholesale volumes were 18,843, up 12 per cent and for Defender 27,117, up 14 per cent. JLR said wholesale volumes for the financial year to date stood at 2,91,113, up 28 per cent YoY.

The Tata Motors stock is up 9.48 per cent in the last one month and 102 per cent in the last one year. Motilal Oswal said that the stock trades at 18.3 times its FY24 consolidated EPS and 15.9 times FY25E EPS. On the other hand, the auto stock trades at 5.7 times FY24E consolidated EV/Ebitda and 4.6 times FY25 EV/Ebitda.

"We maintain our BUY rating on the stock with a target of Rs 900 based on March 2026 SOTP)," the brokerage said.

Retail sales for the third quarter rose 29 per cent to 109,140 units. This includes the Chery Jaguar Land Rover China JV). Retail volumes were higher in all regions year-on-year: UK up 55 per cent, overseas up 49 per cent, China up 28 per cent, Europe up 27 per cent and North America up 6 per cent.

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