Monday morning saw a sharp increase in the share price of Tata Motors following the automaker's unexpectedly good December quarter results. What happened was that Tata Motors recorded a 137.5% increase in consolidated net profit to ₹7,025.11 crore for the quarter that ended in December, up from ₹2,958 crore in the same period last year. The amount exceeded all market projections of approximately ₹4,400 crore. In comparison to the same period previous year, when revenue for Tata Motors was ₹88,489 crore, it increased by 24.9% year over year to ₹1.10 lakh crore. For the most part, the figure matched street estimates.
To ₹15,333 crore, Tata Motors' EBITDA increased by 42.5% year over year. To reach 13.94%, the operating margin increased by 171 basis points. Jaguar Land Rover (JLR), the company's luxury automotive business, brought in ₹76,665 crore in revenue during the most recent quarter, up from ₹58,863 crore for the quarter ending in December 2022.
The Tata Group company anticipates that Q4 performance will continue to improve because of JLR's improved suppliers, new product launches, and seasonality. Furthermore, Tata Motors reduced its net debt by ₹9.5K crore in the third quarter and maintains confidence in accomplishing its deleveraging goals. The net debt of the corporation is approximately ₹29,200 crore.
Analyst Reactions: CLSA kept a "buy" rating on the stock and increased the price objective from ₹955 to ₹1,061. According to the international brokerage business, JLR revealed impressive results, and its commercial vehicle segment outperformed forecasts in terms of profit.
Additionally, Macquarie kept its "outperform" rating for the stock and increased the target price from ₹921 to ₹1,028. The brokerage claimed that in the December quarter, all three of the company's businesses—JLR, Commercial Vehicles, and Passenger Vehicles—had improved margins. In addition, Goldman Sachs kept its "buy" recommendation on the shares, increasing its price objective from ₹870 to ₹960. The company reported better-than-expected results for the December quarter, according to the analysts.
With a target price of ₹1,000, Motilal Oswal kept the stock at a "buy" rating. According to the domestic brokerage, the company's net profit and EBITDA exceeded their projections. Emkay kept its "add" rating on the stock and increased the price objective from ₹900 to ₹925. The brokerage emphasised the company's accomplishment of a healthy margin expansion across all businesses in addition to lowering net debt.
Additionally, Jefferies kept its "buy" rating on the company and increased its price objective from ₹950 to ₹1,100. According to the research agency, the corporation is still the top choice for four-wheeler OEMs (original equipment manufacturers). Price Action: When the markets opened on Monday, the price of Tata Motors' shares was up 5.99% to trade at ₹931.40. The stock reached an all-time high of ₹934 after rising more than 6%.
