On Monday the Tata Motors witnessed a remarkable surge in its share price, by reaching a fresh 52-week high. The rally followed the release of the company’s robust Q3 results, showcasing a substantial increase in consolidated net profit.
Tata Motors shares opened with a bang on Monday, rallying over 7% and hitting a new 52-week high. The shares reached ₹942.00 apiece on the Bombay Stock Exchange (BSE), reflecting investor confidence in the company’s recent performance.
Tata Motors Share Price: Strong Q3 Results:
Tata Motors reported an impressive consolidated net profit of ₹7,025 crore in the third quarter of FY24. This marked a remarkable growth of 137.5% from ₹2,957.71 crore in the corresponding period of the previous year. The surge in net profit was attributed to robust demand for both passenger and commercial vehicles, strategic price hikes, and an improved product mix.
Tata Motors Share Price Revenue Growth:
The company’s revenue for Q3FY24 witnessed a substantial increase of 24.9%, reaching ₹110,577 crore compared to ₹88,489 crore in the same period the previous year. Jaguar Land Rover (JLR), the British luxury car unit under Tata Motors, contributed significantly to the revenue surge, reaching ₹76,665 crore from ₹58,863 crore, year-on-year.
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Operational Performance:
Tata Motors exhibited a strong operational performance during the December quarter. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) saw a notable 42.5% year-on-year increase, reaching ₹15,333 crore. The EBITDA margin also expanded by 171 basis points to 13.94%, indicating improved operational efficiency.
Analyst Recommendations and Target Price:
Global brokerage firm Jefferies showed confidence in Tata Motors by raising FY24-26 EPS estimates by 7-11%. They maintained a ‘Buy’ rating on the stock and increased the target price to ₹1,100 per share. Nomura praised Tata Motors’ Q3 JLR margins, expecting further re-rating and suggesting a ‘Buy’ call with a target price of ₹1,057 per share.
Kotak Institutional Equities upgraded Tata Motors’ stock rating to ‘Add’ from ‘Reduce’ and revised the target price to ₹950 per share from ₹800. The move reflects their positive outlook on the company’s future performance.
Market Performance and Investor Gains:
Tata Motor’s share price has experienced a remarkable upswing, surging over 11% in the last month and an impressive 44% in the past three months. Over the course of one year, the stock has doubled investors’ money, registering a phenomenal growth of over 110%.
Conclusion:
Tata Motors’ stellar Q3 performance, reflected in its robust financial results and the subsequent surge in share price, underscores the company’s resilience and strategic positioning in the automotive market. Analysts express optimism about Tata Motors’ future prospects, making it a notable player to watch in the evolving landscape of the automotive industry. Investors continue to reap the benefits of the company’s consistent growth trajectory, further solidifying its position as a key player in the market.
Disclaimer: The information provided in this article is for informational purposes only. This information should not be construed as financial or investment advice. Investors encouraged to conduct their own research and consult with qualified, certified experts before making any investment decisions.
