1.Tata Motors shares rise 8% following an outstanding Q3 performance.
2. Analysts are bullish on Tata Motors, noting EV performance and JLR chances.
3.Strong Q3 margins beat analyst expectations, arresting the ASP drop.
4.Nomura India finds an appealing valuation of 5 times FY26 EBITDA.
5.Motilal Oswal forecasts a solid comeback, fueled by JLR expansion.
6.YES Securities focuses on improving the India franchise and EV leadership.
7.JM Financial focuses on excellent FCF production and debt reduction.
8. Prabhudas Lilladher emphasises volume ramp-up and a strong order book.
Why Tata Motors Shares soared 8% today :
Tata Motors, a major player in the automotive industry, had a big increase in its stock price, rising by 8% in one day. The significant gain in stock value can be due to a number of factors, including the performance of its electric cars (EVs) and the possibility for its Jaguar Land Rover (JLR) subsidiary to spark a rerating of the company’s shares, according to analysts.
Strong performance in Q3 :
Tata Motors’ strong performance in the third quarter helped to boost investor confidence. The company beat analyst projections by reporting higher profitability. Furthermore, the fall in its average selling price, which had been ongoing for three quarters, was halted due to an improved product mix. Jaguar Land Rover (JLR) also reported strong results, driven by seasonal factors, while maintaining optimistic demand forecasts.
Analyst Insights and Projections :
Nomura India emphasises Tata Motors‘ excellent valuation of 5 times FY26 Ebitda. The firm feels this pricing is enticing, particularly given the expected high free cash flow (FCF) yield of 12% in FY25. Forecasts show a shift from net debt in Q3 to net cash per share in the following fiscal years, with Rs 10 per share in FY25 and Rs 74 per share in FY26. Nomura emphasises that JLR’s re-rating is heavily dependent on the success of its new EV cars.
Motilal Oswal shares this optimism, predicting a strong comeback for Tata Motors as supply-side concerns ease for JLR and commodities challenges stabilise in the Indian market. The firm views JLR as the key engine of growth in the next years, with an EBIT margin of 9.9% by FY26, in line with management’s projections.
Future Outlook and Targets :
Several financial institutions have issued bullish projections for Tata Motors. YES Securities highlights the company’s improved India franchise, early leadership in the Indian EV industry, and increased profitability at JLR. The brokerage maintains a target price of Rs 1,060 for the stock. JM Financial emphasises Tata Motors’ excellent free cash flow generation, which is set aside for investments in JLR’s electrification programmes. The firm intends to considerably reduce net debt and potentially become net cash positive by FY25, resulting in a target price of Rs 1000.
Prabhudas Lilladher attributed Tata Motors’ success to volume ramp-up, a strong order book, and a favourable product mix. The brokerage has set a price target of Rs 1,010 for the stock.
Conclusion :
Tata Motors’ recent share price increase indicates investor optimism, which is driven by the company’s good performance, particularly in the EV category and through its JLR affiliate. With favourable estimates and good financial indications, the company appears to be well-positioned for future growth and value appreciation in the automotive market. Tata Motors continues to be a significant player to monitor in the global automotive landscape as it navigates changing industry dynamics and seizes new possibilities.