Tata Motors downgraded by Jefferies with its lowest price target after Q3 results

Tata Motors downgraded by Jefferies with its lowest price target after Q3 results

Brokerage firm Jefferies has downgraded shares of Tata Motors Ltd. to “underperform” from its earlier rating of “buy” and has sharply cut its price target to ₹660 from ₹930 earlier.

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The revised price target implies a further 13% downside from Wednesday’s closing levels for Tata Motors shares, which have already corrected 36% from their peak of ₹1,179.

Jefferies has downgraded Tata Motors after three-and-a-half years of remaining bullish on the stock as JLR faces weak demand in China and Europe, along with rising customer acquisition costs and higher warranty expenses.

It further said that a slowdown in demand for both commercial and passenger vehicles, along with rising competition in the electric vehicles space act as added headwinds for the stock.

Although Jefferies is anticipating a seasonally better fourth quarter for Tata Motors, it has cut its estimates for financial year 2025-2027 by 7% and 11% and Earnings per Share (EPS) estimates by 5% to 10% over the same timeframe.

Jefferies’ price target of ₹660 is also the lowest on the street for Tata Motors.

Tata Motors reported December quarter results after market hours on Wednesday, January 29, which were a miss on expectations. However, the management said that JLR is on course to meet its margin and cash flow guidance for the full year.

Shares of Tata Motors had ended 3.6% higher on Wednesday, at the day’s high of ₹754.65, ahead of the results announcement.

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