Tata Motors share price jumped by more than 4% on Monday after its strong numbers in the fourth quarter of FY23. The stock touched a fresh 52-week high of Rs 537.15 on NSE
At the time of writing at 11:10 am today, Tata Motors stock traded at Rs 533 apiece, up 3.4% on NSE. In a few minutes of opening, the stock had hit a new 52-week high of Rs 537.15 apiece
According to ICICI Direct Research, there are five key triggers for future price performance in Tata Motors shares. The brokerage expects healthy 20.1% revenue CAGR over FY23-25E driven by 10% total volume CAGR amid healthy wholesale visibility on the JLR front
As per ICICI Direct, Tata Motors' demonstrated capability in newer technologies in CV space & pricing discipline across the industry to aid aspiration of double-digit margins ahead. As per analysts, Tata Motors is in a dominant position in domestic electric-PV space with 80%+ market share
Another key trigger for Tata Motors stock is the company's firmer commitment towards EV by JLR with accelerated investment plan of £15 billion spend over the next five years coupled with a healthy FCF generation target of £2 billion & net debt reduction to <£1 billion by FY24E
Tata Motors' intent to go auto net debt free (most likely in FY25) through healthy CFO generation and sale of non-core assets (including stake sale in Tata Tech) will also be a positive for the auto stock
ICICI Direct has maintained a 'Buy' call on Tata Motors stock with a target price of Rs 650, and sees an upside of 26% in the stock going forward. "TML’s stock price has grown ~11% over the past five years (~ Rs 305 levels in May 2018), outperforming the broader Nifty Auto index."
ICICI Direct said, "We maintain BUY rating amid healthy profitability across all business segments, JLR's volume recovery on the anvil, reiterated focus towards EV space at JLR coupled with healthy FCF generation targets for FY24E."
Nomura India also has a 'buy' rating on Tata Motors stock with a target price of Rs 610, up from Rs 508 earlier. It stated that Tata Motors' EBIT margins may trend up across segments while suggesting that debt reduction would be a key catalyst for the stock
Goldman Sachs has also raised its price target to Rs 600 on Tata Motors stock, while Jefferies has upped its target to Rs 665. JPMorgan has also increased its target on the counter to Rs 455, while CLSA has raised its target to Rs 624 per share
As per Nuvama Institutional Equities, Tata Motors' volume growth is likely to be driven by JLR production ramp-up and the huge pending order book. The brokerage sees a 13% volume CAGR for JLR over FY23–25E
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