Shares of Tata Motors (NSE: TATAMOTORS) a leading automobile company from the giant Tata Group have witnessed a massive bullish run in the last few years. The company has returned nearly 1320% in the last four years, rising from ₹68 in 2020, to making a high of ₹977 this year.
TATAMOTORS is now trading near its 52 week high of 976 and has closed above support level of ₹948.
Last month, Tata Motors moved more than 15% and the stock has consistently made higher highs since past three months. This month’s candle will also close above previous month high, maintaining the same bullish sentiments for Tata Motors.
Improving financials for Tata Motors
Tata Motors have displayed impeccable performance this quarter with its EBITDA being highest in the last 10 years. Their net profits have also been highly improving, rising from 5408 Cr in the previous quarter of 2023, to ₹7025 cr in the latest report quarter (December 2023).
The company has also reported higher return on capital employed at growth of 6.1%. This means Tata Motors is able to generate more returns from its total capital employed indicating improving efficiency for the company.
Foreign Institutional Investors (Fiis) have also consistently raised their stakes in TATAMOTORS. In 2022, Institutional investors had 29.25% of stake in Tata motors, which increased to 36.02% by the end of 2023.
Strong technicals of Tata Motors suggest further upside growth
Tata Motors have outperformed Nifty 50 and sensex in the last one month. While Nifty returned 0.96% this month, shares of Tata Motors have returned over 5% beating Nifty in terms of returns and momentum as well (For momentum we compare RSI).
Along with strong momentum, the move in Tata Motors is also supported by high delivery volume. The stock has grown almost twice from its 52 week low of ₹400 in a very short span of time. Now the company can be seen trading in a narrow range which is a sign of accumulation phase.
Breakout from the current range of 890 – 970 may lead to further up move in Tata motors. Though the share is in the overbought zone, targets of ₹1000 looks achievable.
In the short term, the company can experience profit booking leading to a fall in its share price; however, smart traders can treat this as an opportunity to accumulate the stock. Intraday trader can use these daily price target for Tata Motors as reference for day trading.
TATAMOTORS company details
| Category | Value |
|---|---|
| Market Cap | ₹ 3,15,974.77 Cr. |
| Enterprise Value | ₹ 3,33,432.56 Cr. |
| No. of Shares | 332.33 Cr. |
| P/E | 37.3 |
| P/B | 11.44 |
| Face Value | ₹ 2 |
TATAMOTORS profit growth last 5 years
| Period | Profit Growth |
|---|---|
| 1 YEAR | 296.15% |
| 3 YEAR | 33.41% |
| 5 YEAR | 35.9% |
Final Words
Tata Motor, backed by one of India’s largest conglomerates having multiple popular brands like Jaguar, Safari, Defender, etc is growing its business even in futuristic markets like Electric Vehicles (EV).
As the average purchasing power of Indian’s is rising, they will continue to buy luxuries like Cars. Not just B2B, Tata have also expanded its automobile segment to B2B where they provide carriage vehicles like Tempos and Trucks.
Fueled by investor confidence and strengthening fundamentals, Tata Motors is poised for growth.
