Tata Motors Ltd shares climbed as much as 5.5% in intra-day trade on Thursday, i.e. 2 January, after research firm Citi maintained its ‘buy’ rating on the stock with a target price of Rs 200.
The stock further rallied after Tata Sons moved the Supreme Court to challenge the National Company Law Appellate Tribunal’s judgment that reinstated Cyrus Mistry as executive chairman of Tata Group’s holding company.
At 3:01 pm on Thursday, Tata Motors shares were trading 4.6% higher at Rs 193 after hitting the day’s high of Rs 194.70. The stock has rallied over 20% in the last one month itself.
Global research firm Citi has a positive stance on the recovery of Tata Motors’ UK-based subsidiary JLR even as domestic sales and demand scenario remains muted.
Citi expects JLR to see strong margin improvement along with better volume cadence. For the domestic business, Citi is of the view that the commercial vehicle industry in India is unlikely to recover very fast, but Tata Motors should maintain its dominance in the segment. The passenger vehicle portfolio is improving but competition is escalating as well, it added.
On Wednesdsay, Tata Motors reported a 12% decline in total vehicle sales in the domestic market to 44,254 units in December compared with 50,440 units in the same month in 2018. Of this, total passenger vehicle sales stood at 12,785 units, down 10% from 14,260 units in December 2018.
Tata Motors president (passenger vehicles business unit) Mayank Pareek said: “Our focus in December has been to drive retail and minimise the network stock in order to facilitate a smooth transition to BS-VI.”
He added: “Having almost completed our planned production and despatches of BS-IV, we will start moving to BS-VI production and despatches from January and step up our volumes in the coming months.”
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