According to stock market experts, Tata Motors shares are rising due to strong quarterly results after a gap of seven quarters. They said that Tata Motors has reported better than estimated Q3 results with improved margins. Market experts went on to add that the auto company has reported ₹8,850 crore consolidate revenue in Q3FY23, which became possible after better realisation in JLR and standalone business of the company. They predicted that Tata Motors shares may go up to go up to ₹500 apiece levels in two to three months and advised 'buy on dips strategy in regard to the auto major till it is trading above ₹420 per share levels.
Speaking on the reasons that led to rise in Tata Motors share price today, Saurabh Jain, Vice President — Research at SMC Global Securities said, "Tata Motors has reported strong Q3 numbers beating the market estimates by a big margin. Most interestingly, the auto major has managed to report such a srong number after reporting tepid quarterly numbers in last seven straight quarters. The company has reported improved margins as well."
SMC Global expert said that other auto companies like Maruti Suzuki India Ltd and Bajaj Auto have also reported better than expected results and hence auto theme is expected to work in short time. And in that case Tata Motors shares that has remained to negative may witness strong buying interest by Dalal Street bulls.
Highlighting upon key takeaways from Tata Motors Q3 results, Himanshu Singh, Research Analyst at Prabhudas Lilladher said, "Tat Motors reported consolidated revenue at ₹8,850 crore ( ₹885 bn), which was led by better realizations at JLR and standalone business. The company reported 290 bps QoQ expansion in EBITDA margins. EBITDA margin at 13.9 per cent was driven by 110 bps contraction in RM cost ratio and overall operating leverage."
On JLR business of Tata Motors, Himanshu Singh said, "JLR has returned to profit as chip shortages eased in the quarter and production and wholesales increased. TTMT maintained cautiously optimistic outlook on the demand situation at JLR despite global uncertainties."
Expecting uptrend to further continue in Tata Motors shares, Anuj Gupta, Vice President — Research at IIFL Securities said, "Those who have Tata Motors shares in their portfolio are advised to hold it further maintaining trailing stop loss at ₹420 apiece. For those who want to buy the stock can add Tata Motors stock in one's portfolio at current levels and maintain buy on dips strategy till it is trading above ₹420 levels. However, fresh investors must maintain stop loss at ₹398 apiece levels. Tata group stock is expected to go up to ₹500 levels two to three months or say by the end of current fiscal."
In Q3FY23 results announced on Wednesday, Tata Motors reported a consolidated net profit of ₹3,043 crore, which became possible on account of robust sales. The Mumbai-based Tata group company had reported a net loss of ₹1,451 crore in Q3FY22.
Total income of the company increased to ₹88,489 crore in Q3FY23 from ₹72,229 crore in Q3FY22. On a standalone basis, Tata Motors reported a net profit of ₹506 crore in the third quarter, a jump of over two-fold, from ₹176 crore in the October-December period of 2021-22.
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The company said it remains cautiously optimistic on the demand situation despite global uncertainties.
In early morning deals, bloodbath on Dalal Street continues for second straight session as Sensex nosedived over 800 points whereas Nifty crashed to the tune of 250 points, breaking its crucial support placed at 17,770 levels.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
