Why Tata Motors Shares Jumped Back In Green After 2 Days

Shares of Tata Motors jumped back in the green on Tuesday morning ending its two straight session losing streak.

What Happened: The stock is upbeat as Tata Motors’ luxury vehicle subsidiary, Jaguar Land Rover (JLR), posted its sales update for the December quarter in an exchange filing released in the after-market hours on Monday.

Wholesale volumes for the quarter reached 1.01 lakh units (excluding the Chery Jaguar Land Rover China JV), indicating a remarkable 27% increase compared to the corresponding period last year and a 4% uptick from the second quarter of FY24. As per the filing, this quarter marked the highest wholesale figures in 11 quarters for the company.

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On the retail front, third-quarter sales exhibited a 29% YoY increase, totalling 1.09 lakh units compared to the same quarter in the previous year. The auto giant said that it observed healthy growth in retail volumes across all regions, with the UK leading at an impressive 55% YoY increase. Overseas markets, including China and Europe, showed substantial upticks of 49%, 28%, and 27%, respectively. Even in the highly competitive North American market, retail volumes demonstrated commendable growth, recording a 6% YoY increase.

The company said that its order book remains robust at 1.48 lakh client orders at the end of the third quarter.

Analyst Reactions: Analysts remained positive on the stock as the update came. Morgan Stanley maintained its “overweight” rating for the stock with a price target of ₹890. The investment banking firm said that JLR’s wholesale numbers were mostly in line with estimates.

JP Morgan also maintained its “overweight” rating for the stock with a price target of ₹925. The research firm sees the company reporting a strong quarter in profitability from both JLR and India businesses.

Domestic brokerage firm Motilal Oswal also maintained its “buy” rating for the stock with a price target of ₹900.

Price Action: Tata Motors’ share price was up 1.38% to trade at ₹800 as the markets opened on Tuesday.

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