Tata Motors gets more fuel for shares to run higher
Tata Motors' shares surged by up to 6%, reaching a peak of Rs 485 on the BSE, following the company's impressive earnings report for the first quarter of FY27. The net profit climbed by 83.3% to Rs 2,560 crore, up from Rs 1,397 crore in the same period last year. Revenue from operations also rose by 19% to Rs 20,667 crore, while the EBITDA increased by 10% year-on-year to Rs 2,300 crore.
EBITDA margin, however, dropped by 90 basis points to 10.9%, due to a 13% year-on-year increase in total expenses. Nomura upgraded Tata Motors to Buy with a target price of Rs 554, anticipating growth from its EV focus and robust export orders. CLSA rated the stock as Outperform, targeting Rs 596, citing a 50 basis points margin decline due to commodity inflation, which they expect to be mitigated through price hikes and cost reduction measures.
Tata Motors now expects double-digit growth in revenue, EBITDA, and PAT over FY26-28E, valuing the core business at 12x FY28E EV/EBITDA.
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