Why Tata Motors shares rallied over 7% despite weak markets – Explained

According to stock market experts, after a gap of seven quarters, Tata Motors shares have gained momentum due to strong quarterly results. He said that Tata Motors has produced better than expected results for the third quarter with better margins. Market experts further said that the auto company has given the report 8,850 crore consolidated revenue in the third quarter of FY23, which was possible after better realization in JLR and the company’s standalone business. He predicted that Tata Motors shares may go up 500 level in two to three months and advised to buy on ‘dips’ strategy with respect to auto major as long as it is trading above. 420 per share level.

Speaking on the reasons for the rise in Tata Motors share price today, Saurabh Jain, Vice President – Research at SMC Global Securities said, “Tata Motors has reported strong third quarter numbers, beating market estimates by a wide margin. What is interesting is that the auto major has reported such low numbers after reporting sluggish quarterly numbers for the last seven straight quarters. Have managed to report numbers. The company has reported an improvement in margins.” as well.”

Experts at SMC Global said that other auto companies like Maruti Suzuki India Ltd and Bajaj Auto have also given better than expected results and hence the auto theme is expected to work in the short term. And in that case Tata Motors stock which continues to turn negative may see strong buying interest from the bulls of Dalal Street.

Highlighting the highlights of Tata Motors’ Q3 results, Research Analyst at Prabhudas Lilladher, Himanshu Singh said, “Tat Motors has reported consolidated revenue. 8,850 crore ( 885 bn), which was due to better realizations in JLR and standalone business. The company reported 290 bps QoQ expansion in EBITDA margin. EBITDA margin at 13.9 percent was driven by a 110 bps contraction in the RM cost ratio and overall operating leverage.”

on JLR’s business Tata MotorsHimanshu Singh said, “JLR returned to profit on the back of chip shortages in the quarter and increased production and bulk sales. TTMT maintains a cautiously optimistic outlook on demand conditions at JLR despite global uncertainties.”

Tata Motors shares expected to continue rally Anuj Gupta, Vice President – Research at IIFL Securities said, “He Who? If they have Tata Motors shares in their portfolio then they are advised to hold it further by maintaining trailing stop loss 420 each. Those looking to buy the stock can add Tata Motors stock to their portfolio at current levels and maintain buying on dips strategy till it is trading above. 420 level. However, new investors should maintain stop loss 398 each level. Tata Group stock is expected to go up 500 level in two to three months or say by the end of the current financial year.”

In Q3FY23 results announced on Wednesday, Tata Motors reports a consolidated net advantage of 3,043 crore, which was possible due to strong sales. The Mumbai-based Tata group company had posted a net loss 1,451 crore in Q3FY22.

The total income of the company increased 88,489 cr in Q3FY23 from 72,229 crore in Q3FY22. On standalone basis, Tata Motors reported a net profit of Rs. 506 crore in the third quarter, a jump of more than two times 176 crore in the October-December period of 2021-22.

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The company said it remains cautiously optimistic about the demand situation despite global uncertainties.

In morning trade, the bloodbath on Dalal Street continued for the second straight session as Sensex fell over 800 points while smelly Broke up to 250 points and broke the important support placed at 17,770 level.

Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint. We advise investors to do due diligence with certified experts before making any investment decision.