Tata Motors Share Price

The fundamentals of Tata Motors Limited: An evaluation

Tata Motors Limited has manufactured everything from Nexon and Safari to Range Rover and Jaguar cars. However, before this company jumped into manufacturing commercial vehicles, it had a completely different trajectory.

It was 1945 when Tata Motors used to manufacture locomotives and engineering products. Fast forward to FY24, and this company has sold a whopping 431,733 JLR vehicles! So has Tata Motors reached its peak, or is there still a large scope in the sales and the Tata Motors share price?

Let's dive into this article and explore this company’s fundamentals and Tata Motors' share price target in the coming months.

About Tata Motors Limited

Tata Motors Ltd. began its journey in 1945 as Tata Engineering and Locomotive Company (TELCO). This company is also part of the $300+ billion (INR 24+ trillion) Tata Group.

Tata Motors is India’s leading automaker, shaping smarter and greener mobility for cars, trucks, buses, and electric vehicles. The company caters not only to the Indian market but also to over 175 countries.

To meet the growing demand of its target customers, Tata Motors has over 25 manufacturing facilities and 9,400+ touchpoints worldwide. Currently, the company is led by Natarajan Chandrasekaran, the Non-Executive Director and Chairman.

Regarding innovation, the company is currently working on the AVINYA Concept for its Tata Passenger Electric Mobility (TPEM). This GEN 3 architecture introduces a new typology of mobility and will emphasise roominess, comfort, and wellness during transit. The TPEM will also be equipped with cutting-edge technology, software, and AI and is expected to launch in 2025.

Tata Motors is leading EV development in India through the Tigor EV and the Nexon EV.

In the financial year 2023-24, the company sold 1,71,697 units of the Nexon, making it the best-selling SUV for three consecutive years.

Is the automotive sector company a goldmine investment?

To answer this question, let’s consider a few statistics. In 2024, the Indian passenger vehicles market is valued at USD 65.3 Billion, and this figure is predicted to shoot up to USD 133.8 Billion by 2033 with a CAGR of 9.6%! So, in short, the automobile sector in India is booming.

In terms of EVs, India’s target is to capture 30% of the total world market share, and according to the NITI Ayog press release page, this sector is growing at a staggering 49% CAGR between 2022 and 2030! Another report by the Energy Storage Alliance suggests that the segment's growth will be at a 36% CAGR until 2026.

Considering these growth prospects and Tata Motors being at the forefront of this automotive revolution, there will definitely be an impact on Tata Motors share price! Therefore, there is a great chance of reaping lucrative returns from the automotive sector in the upcoming years. In fact, Tata Motors share price forecast for March 2025 is Rs. 1,200 with a strong “Buy” rating.

Who are Tata Motors Limited’s competitors in the automotive sector?

Some of the noted competitors of Tata Motors are:

• Maruti Suzuki India Limited
• Mahindra and Mahindra Ltd
• Ashok Leyland Limited
• Eicher Motors
• Olectra Greentech

History of Tata Motors Limited

Tata Motors is known for manufacturing affordable commercial and private vehicles equipped with many high-tech components. Let's look at the history of this company briefly.

• Incorporation: Tata Motors was founded in 1945 as a segment of Tata Engineering and Locomotive Company (TELCO). The company initially focused on locomotive manufacturing, but it soon expanded into the automotive sector.
• Acquisitions: The company entered the South Korean market in 2004 by acquiring Daewoo's commercial vehicle business. In 2005, it acquired a Spanish bus and coach manufacturer, marking its presence in Europe.

The most significant acquisition came in 2008 when the company acquired the iconic British brands Jaguar and Land Rover. This strategy has helped the company expand its global footprint and strengthen its luxury car portfolio.

• Product range: Tata Motors' product lineup includes Pickup trucks, Commercial vehicles, Luxury vehicles, SUVs, and Electric vehicles.
• Infrastructure: The company has manufacturing facilities in Jamshedpur, Jharkhand; Pune, Maharashtra; Lucknow, Uttar Pradesh; Sanand, Gujarat; Pantnagar, Uttarakhand; and Dharwad, Karnataka. It also has facilities in Argentina, South Africa, the United Kingdom, and Thailand.
• Awards & recognition: In Tokyo, the company received the Asia IP Elite 2022 Award. ASSOCHAM also awarded Tata Motors the IP Excellence Awards for being a top patent-driven industry. Tata Motors also received the Golden Peacock Global Award for Sustainability.

Company profile of Tata Motors Limited

Pros

• Domestic growth potential: India’s growing middle class and increasing disposable income create a favourable environment for automobile sales. Tata Motors stands to benefit from this domestic market growth.
• Global presence and market leadership: Tata Motors operates in various international markets, including Europe, Asia, Africa, and Latin America. Its strong presence positions it well to benefit from global automotive trends and growth opportunities.
• Strong brand recognition: Tata Motors is a well-established brand with a rich history. Its reputation for quality and innovation contributes to customer loyalty and trust.
• R&D: Consistent investments in research and development have led to breakthroughs in areas like autonomous driving and connected cars.

Cons

• High competition: The automotive industry is highly competitive and subject to rapid changes. If there is a shift in consumer preferences, technological advancements, and government regulations, Tata Motors share price forecast may be downgraded.
• Industry income growth: Over the last five years, Tata Motors' revenue has decreased at an annual rate of -23.12%, whereas the industry average for the same period was -3.06%, which can affect investor sentiment and reduce Tata Motors share price target.
• Market share: With automobile brands launching new models every few weeks, Tata Motors' market share has declined slightly. In the last five years, it decreased to 57.8% from 62.12%.

The finances and Tata Motors share price forecast

Here’s a brief information on Tata Motors’ financials as of June 2024:

Metric	Value
Market cap	Rs. 3,24,000+ Cr
Market price	Rs. 970+
Book value	Rs. 90.12 (Per share)
Dividend yield	0.61%
ROCE	22.42%
ROE	30.12 %
Face value	Rs. 2.00

The Tata Motors share price is predicted to rise to Rs. 1,200 by March 2025, while the Tata Motors share price today stands around Rs. 970.

Shareholding pattern of Tata Motors Limited

The shareholding pattern has an impact on Tata Motors share price chart, as it reflects the trust of different categories of investors in the market. Here is the overview.

• Promoters: Hold 46.36
• Foreign institutional investors (FII): Hold 19.2%
• Domestic institutional investors (DII): Hold 16.14%
• Public: Hold 18.3%

Peer multiple comparison

When comparing Tata Motors share price to its peers, you must also compare the following metrics.

Metric	Tata Motors Limited	Maruti Suzuki India Limited	Force Motors Limited	Ashok Leyland Limited	Mahindra and Mahindra Ltd	Eicher Motors
P/E ratio	41.11	29.14	29.36	26.25	34.04	35.63
P/B ratio	10.85	4.58	5.07	7.80	6.98	8.51
Dividend yield	0.61%	1.02%	0.22%	2.12%	0.72%	1.04%